Real estate prices in the Blloku area of Tirana have reached EUR 5,000 per square metre, a significant increase from the EUR 3000 price tag quoted for many in 2021.
Projects designed by Italian Studio Stefano Boeri Architetti, including Rainbow Centre, West Residences, Book Building, and Green Terrace, are all high-end developments in sought-after locations. All high-rise buildings with underground parking, offices, and luxury apartments, are on sale for EUR 5000 per square metre, according to the sales office of the developer Invest Society.
The sales office told Monitor that in the Rainbow Centre, a seven-storey building with two floors of shops, all units have been sold.
The Association of Builders claims the price increase is due to the rising cost of materials, increased salaries and taxes.
Arben Dervishi, the association’s secretary general, told Monitor that the cost of aluminium, copper, iron and cement has increased by 200%.
“Already in the capital, there are no more constructions with a cost of 300 to 400 euros per square meter. The cost for apartments has reached EUR 800 per square meter due to the increase in quality. For the towers, due to the use of materials and unique facades, the construction costs reach up to EUR 2,000 per square meter. So the increase in the prices of apartments is reflecting the development trend of the prices of construction materials”.
But this will have a knock-on effect on the cost of non-luxury developments. The selling price of such properties has increased from EUR 800 per square metre in 2021 to over EUR 1000 today.
In May, INSTAT reported that the average cost of property in Tirana per square metre was EUR 1,143.
But the number of permits is also growing as in the first six months of 2022, some 736 building permits were granted nationwide with a construction cost of over half a billion euros. Some 1.7 million square metres of development were approved with the majority in the capital.
Tirana had 207 permits, followed by Durres with 55. Permits in Tirana account for EUR 350 million of the total amount.
An estate agent working for a city-wide broker said demand is high and is continuing to increase. When asked who buys properties, he explained that they see a lot of interest from investors.
“They are buying property even before it is built, several apartments at once. Then selling when built to make a profit. Others are buying up apartments to rent to foreigners,” he explained.
Much of Tirana’s construction boom, however, is believed to be driven by dirty money. The Global Initiative Against Transnational Crime Initiative estimated that between €300-700 million in dirty cash enters Albania each year, much of which is destined for the construction sector.
Money Laundering Feeds Dangerous Housing Market Bubble in Albania
