Business news from Ukraine

Relocation conducted an analysis of the Albanian housing market in the first half of 2025. In 2025, the market is moving towards normalization after an extremely turbulent period from 2022 to 2024. There are fewer building permits, the growth in construction costs has slowed down, prices in the capital have stabilized, and prices on the coast remain high. The share of deals involving foreigners is close to one in five for the half-year, based on the latest Bank of Albania survey (data for H2’2024), and their investments exceeded €380 million in 2024.

Building permits. In Q1 2025, 258 permits for new buildings were issued (-17% y/y). This is a sign of caution on the part of developers after record years and a factor that will restrain supply in 2025-2026 (we are awaiting data for Q2).

Construction costs. The housing construction cost index (INSTAT) rose by 1.0% y/y in Q1 2025, significantly slower than a year ago (3.4% y/y), which partially relieves price pressure from materials and labor.

Prices: capital vs. coast

• Tirana. Local sources note price stabilization in early 2025 after strong growth in 2022–2024; the market Fisher index indicates that there has been no significant price increase in 2025 (in the long term — an increase of about 40% over 10 years).
• Coast (Vlora/Saranda). The media reports that prices remain high and demand is strong, with double-digit growth in some locations until 2024 (most strongly in the prestigious coastal districts of Vlora). This is largely due to tourism and interest from non-residents.

According to the Bank of Albania (latest published market survey, H2’2024), about 18% of apartments sold in Albania were purchased by non-residents, of which ≈77% were EU citizens. This is an important benchmark for the first half of 2025: the share of foreigners remains significant, especially in coastal municipalities.

Mortgage loans finance a significant portion of transactions, but the share of cash purchases remains high in resort areas.

Rentals and profitability

• Tirana. After peaking in 2023–2024, rental rates in the capital adjusted and stabilized in early 2025. (Consolidated market estimates: moderate decline/sideways movement with high occupancy rates.)
• Coastal areas. In Vlora/Saranda, rental yields remain relatively high thanks to the tourist season; for one-bedroom apartments in Vlora in 2025, the benchmark is €300–500/month in the off-season (higher in summer), which supports investor interest in rental properties.

Foreign buyers

• Total volume. In 2024, non-residents invested €380 million (+17% y/y) in Albanian real estate. This is the third year of consecutive growth; the trend for 2025 is for foreign activity to remain strong (official monthly breakdown by nationality for 2025 is not published).
• Who is buying. The Bank of Albania confirms the dominance of EU citizens among foreigners; according to Albanian media and market reports, buyers from Italy, Germany, Poland, the Czech Republic, and the UK, as well as Middle Eastern and regional investors, remain highly interested, especially in coastal cities. (This is an assessment by the press/agencies; there is no official ranking by nationality.)

As for forecasts, supply will grow moderately. As for prices, there will be more stable dynamics in the capital and higher seasonal volatility on the coast. Demand from non-residents will remain strong, especially in coastal locations and rental projects.

Source: http://relocation.com.ua/analysis-of-the-housing-market-in-albania-in-the-first-half-of-2025/

ALBANIA, HOUSING

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