We recently enjoyed a ten night trip in Montenegro travelling by car. We are a family of four with two kids aged 5 and 8. We drove from Belgrade and stopped for two nights in south west Serbia along the way. The border crossing was fine but be prepared for a very long, windy, mountainous drive to get to the coast, and the local drivers are pretty reckless!
First stop in Montenegro was three nights at Hotel RR at Melijine, just out of Herceg Novi. I can't recommend this highly enough. Right on the water with lovely views from every room, a large terrace over the water with sun lounges and umbrellas, and perfectly set up for families. The food was superb and the service was friendly and extremely courteous. We had a very large room with four beds, breakfast and dinner daily for around AUS $120 per night. This is a family run hotel and the owner made a point of welcoming us which was nice too.
From here we drove round the bay to Kotor where we had booked into a 2 bed apartment in the old town for 2 nights. Staying right in the heart of the old walled town was brilliant and super convenient, but it does get pretty crowded when the cruise ships hit town and with no breezes penetrating those ancient stone walls, it gets extremely hot! Fortunately there are plenty of cool bars to discover as well as lovely outdoor terraces with umbrellas and mist fans. We got up very early one morning to climb the fortress behind the town which is worth the hard climb for the breath- taking views it provides. We were also lucky enough to be there when the summer cultural festival was on which provided free nightly entertainment on stages set up around the town which our kids really enjoyed.
Next was a drive around to Budva for a four night stay at Hotel Slovenski Plaza. This is in a very busy part of town with markets, bars and entertainment/rides set up all along the beach. Most of the tourists are Russian and all menus and signs are in Russian, so it as a very different feel to other parts of Montenegro. We ended up spending most of our time at night in Budva old town - taxis are plentiful and cheap - as we preferred the more authentic, less 'carnival' atmosphere. Some lovely restaurants and ultra trendy bars, including right on the small beach just outside the city wall. During the day we took the ferry across to the island of Hawaii and also hired a boat with a driver to explore the coast down to Sveti Stefan (50 euros for 4 hours).
After driving along the coast to Bar we caught the overnight train back to Belgrade with a sleeper cabin for about 120 euros for 4 of us and the car. This was great fun and far easier than the drive!
We really enjoyed this trip. Montenegro was beautiful, inexpensive (particularly at the Croatian end of the coast) and we found it easy going and very relaxing (apart from the driving!). Our travels were made much easier by having a native speaker on board (my husband) and I'm not sure how much English was in use as we never really had to rely on it. Everyone we encountered was friendly and helpful without exception, and the food was tasty and in huge servings. As others have noted, development there seems full steam ahead and one gets the feeling that it's a bit of a free for all with little or no limitations, so it might be best to get there sooner rather than later.