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Real estate in Albania

Forget everything you have learned about Eastern Europe when you are planning to go to Albania. Don't think you can understand its people by simply transfering your own experience from other poor countries you have already visited. Albanian real estate is something unique and it will remain unique in Europe for a long time ahead.

The absence of financial markets and the irrelevance of financial variables in the workings of the real economy, especially the enterprise sector, have meant that the development of the real estate market has taken place within the wider evolution of the real and financial economy.

At present, real estate lending and real estate transactions in Albania are constrained by a number of factors, including a large concentration of unregistered properties, delays in enforcement of legal contracts, excessivepermitting requirements, urban development activities stalled by an overly layered administrative framework and by the length of resolution of the restitution issue. The lack of information on the magnitude of the registration problem, on actual household income and the market value of real estate transactions further exacerbate the issues.

Real estate prices in the capital seem very high considering that the average salary in the country doesn't exceed $100 a month. Most apartments vary between $300 and $650 per sq.meter (1 sq.meter=10 sq.feet). If you want to rent something, rents for 2-room (not 2BR) apartments go between $200 and $400. 3-room apartment rents can reach $800 and 4-room condos - $1200 a month.
Office rents vary between $5 and $10 per sq.meter a month but they can reach as high as $40 a month in Tirane downtown. Rents for commercial properties are similar. The land, which usually can be purchased for $5-$10 per sq.meter, may reach $100 for the lots to be expropriated around the high-speed interstate road under construction from the Albanian port of Durres to Bulgarian port of Bourgas via Macedonia.

In Albania's growing economy, real estate has emerged as one of the most appealing investment areas for domestic as well as foreign investors. Apart from the economic growth which is spurring growth in the real estate sector, the recognition of the need to invest heavily in infrastructure and of involving private participation therein, the recent legislation regarding creation of Special Economic Zones (Albania One Euro plan) and the growth of road concession contracts witness it.

By: DThiery

Damien Thiery is managing director of www.propertyuncovered.com and www.romanianpropertiesltd.co.uk

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