By Vangjel Dhimo on February 13, 2023
Foreign investments in Albania’s real estate sector have surpassed the total mark one billion euros as of 2023
According to Bank of Albania statistics, the amount of these investments has expanded significantly in recent years.
At the end of September, it was reported that total foreign individual or entity investment in the Albanian real estate market had reached 1 billion and 35 million euros, a 43% increase over the same period of the previous year.
Since 2015, the stock of foreign investment in real estate has nearly tenfold grown.
Real estate investments currently account for 9.5% of overall foreign investment in the country, the largest percentage ever recorded.
According to industry analysts, the demand for real estate in Albania from foreign nationals or non-residents has played a significant part in the recent cycle of price hikes. According to Bank of Albania polls, around one-third of buyers from outside Albania are claimed to be European Union nationals.
This year (2022) real estate agencies have reported a large number of purchases by foreign nationals. Czechs, Poles, Germans, and Nordics, particularly Swedish and Finland in Saranda, they claim, they dominate in these transactions.
Because of Albania’s location, climate, and beneficial taxation structure in comparison to their home countries, an increasing number of international nationals are electing to invest in property in Albania.
Another thing to consider is that property prices on the Albanian coast are relatively competitive when compared to other nations in the region, such as Montenegro or Croatia. Property values have risen dramatically in recent years, making real estate an even more appealing investment option.
This has increased the number of buyers who have purchased residences for investment purposes rather than for personal or family usage. This category, according to the agencies, also includes an increasing number of international investors.
According to the agents, another occurrence is the return of Albanians. Because of the necessity for money at the start of their emigration, many of them sold their Albania property for very cheap prices.
However, once they have settled in the countries from where they immigrated, many of them are opting to use their earned funds to purchase a second property in Albania.
HOW PRICES IN ALBANIA GREW MORE THAN ALL EU COUNTRIES IN 2022?
Apartment prices in Albania have increased significantly in the last year, surpassing even those in some European Union (EU) countries. This sudden surge in real estate values has caught many Albanians by surprise, and has raised concerns about the future of the country’s housing market.
One of the main reasons for the increase in apartment prices is the rapid pace of economic growth in Albania. The country’s GDP has been growing at an impressive rate, driven by rising foreign investment and improved economic conditions. This growth has fueled demand for housing, particularly in the capital city of Tirana, where the majority of foreign investment is concentrated. As a result, apartment prices have risen dramatically, outpacing growth in other sectors of the economy.
Another factor contributing to the rise in the Albanian real estate market prices is the government’s efforts to attract foreign investment. Albania has made significant investments in its infrastructure and has implemented various tax incentives to encourage foreign businesses to set up operations in the country. This has attracted a large number of foreign investors, who are now driving up housing prices as they compete for limited housing options.
Despite these positive developments, the sudden surge in apartment prices has raised concerns among Albanians. Many are worried that they will be priced out of the housing market and that their homes will become unaffordable. This is especially true for those who live on low or fixed incomes, who are struggling to keep pace with the rising cost of living.
The government has taken steps to address these concerns, by introducing a number of measures to make housing more affordable for ordinary Albanians. For example, it has increased the availability of low-cost housing options and has provided subsidies to help people purchase homes. However, these measures have had only a limited impact, and many Albanians are still struggling to find affordable housing.
Another issue contributing to the rise in apartment prices is the limited supply of housing in the Albanian real estate market. Despite the growing demand for housing, there is a shortage of new homes being built, due to a number of factors including high construction costs, zoning restrictions, and lack of access to financing. This shortage has caused prices to soar, as buyers compete for limited housing options.
To address this issue, the government has introduced a number of measures to encourage the construction of new homes. For example, it has reduced taxes on building materials, and has provided subsidies to builders who are constructing affordable housing. These measures have had a positive impact, and have encouraged more builders to enter the market.
Despite these efforts, the shortage of housing continues to be a major issue in Albanian real estate, and is driving up prices. To address this, the government needs to take a more comprehensive approach, by addressing the root causes of the housing shortage and improving the country’s overall business environment. This will require significant investment in infrastructure, such as roads, transportation, and energy, as well as the creation of a more favorable business environment for builders and developers.
In case you are actively looking to buy a property in Saranda, Albania then we would be more than happy to be the first to assist you in your own journey.
Saranda’s has very luxurious ambiance, and its coastline sector is especially popular among second homeowners, as its luxury apartment complexes, private villas, and townhouses give tranquillity paired with a magnificent oceanfront setting.
