Tirana leads sharp real estate surge as apartment prices soar 56% in six months
Apartment prices in Albania have skyrocketed in the second half of 2024, with Tirana seeing the steepest increase. According to the latest Bank of Albania survey, nationwide housing prices rose by 44.5% compared to a year ago, with the capital alone recording a 56% surge.
Why is this important: The data confirms a continued boom in Albania’s real estate market, despite tightening credit conditions and growing affordability concerns. In just six months, apartment prices across the country increased by 23.6%, with Tirana outpacing the rest of the market. The central bank attributes the price hikes to rising construction costs — including wages, energy, and transport — and sustained demand for housing.
Context: While developers report cost pressures, the demand for property remains high. Properties are selling faster, and credit-supported purchases are on the rise. The Bank of Albania notes that 50% of all residential and commercial real estate transactions were financed by bank loans. In 72% of those cases, the loans covered up to 60% of the property’s value.
However, banks have begun tightening lending standards amid concerns over borrowers’ repayment capacity. This comes as debt burdens increase among both businesses and families who are turning to credit to meet rising housing costs.
At the same time, the once-booming demand from foreign buyers appears to be cooling. In the first half of 2024, non-residents accounted for 26% of residential property purchases. That share dropped to 18% in the second half of the year. Most of the foreign buyers — about 77% — came from EU countries.
Rental prices have also spiked, particularly in Tirana, driven by growing demand and limited supply.
What’s next: Despite tightening conditions, the market shows no signs of slowing down. With demand still strong, especially in urban centers like Tirana, analysts expect prices to remain high well into 2025 — unless further restrictions are introduced or a correction emerges naturally.
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