The number of construction permits in Tirana in the first quarter of 2022 is equivalent to half of the total issued throughout the whole of 2021 signalling a significant increase.
As the capital’s construction boom continues, some 800,000 square metres worth of construction permits were issued between January and March 2022, more than double the same period in 2021.
In terms of permits issued throughout the whole of Albania, the majority, some 77% were issued in the capital. According to the data, the value of the issued permits in terms of building and engineering works is some EUR 235 million whereas, for the whole of 2021, it was EUR 470 million.
Number of Construction Permits Issued So Far This Year up 36%
A total of 397 permits were issued during the first three months of the year throughout Albania, an increase of 58.2% on the year before. This equates to some 1.03 million square metres of new real estate, 72% more than in the same period of 2021.
The figures from 2021 were already significantly higher than in 2020, doubling in Tirana. Data for the first quarter of last year showed that the number of permits increased by around 36% when compared with the previous year.
The sheer volume of money pumped into the Albanian construction sector has piqued the interest of those involved in monitoring illicit monetary flows. The Global Initiative Against Transnational Crime Initiative (GIATOC) in 2020 estimated that up to EUR 700 million in illegal money enters the country each year, most of which is destined for the construction sector.
The construction boom has led to a significant increase in both purchase costs and rental costs. In some cases, property prices have gone up to 70 % over the last five years.
Currently, the average price of real estate in Tirana is EUR 1143 per square metre, increasing on a monthly basis. Property inside the Ring Road of Tirana starts at EUR 1300 per square metre and can reach EUR 3000 or more in highly sought after areas or luxury developments. Meanwhile in suburban areas, the average price is EUR 1000 per metre.
The data was published by Keydata Albania and is a private index of property prices in the country. They looked at average and media prices throughout the city which they split into three divisions; inside ring, outside ring, and Blloku.
Between 2020 and 2022, the average price across the whole city, increased by EUR 100 per square metre, going up EUR 16 in the first quarter of 2022.
An estate agent working for a city-wide broker said demand is high and is continuing to increase. When asked who is buying properties, he explained that they are seeing 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.
