According to Serbian Economist, the Albanian real estate market is showing the first signs of cooling after several years of sharp price increases. In June, the construction confidence index fell by 0.8 points, and developers revised their forecasts for future orders and prices downward, according to the Bank of Albania’s business and consumer confidence survey.
The key signal is the decline in expectations for new contracts. The balance indicator for construction orders fell to minus 26.2 points, meaning that the number of companies expecting a decline in orders significantly exceeds the share of optimists. At the same time, current construction activity remains roughly at the same level.
Prices have not yet entered a sustained decline, but developers’ expectations have weakened sharply. The price expectations index remains positive at 14 points—meaning that part of the market still expects growth—but in May the figure was 22 points, and in the spring it hovered around 30 points. This suggests not so much an immediate drop in prices as a rapid slowdown in the market.
The Bank of Albania also reports a slowdown in housing price growth. According to the Fisher Index, average prices of completed transactions rose by 11.7% compared to the previous half-year and by 28% year-over-year, but this is already lower than the rates seen in the first half of 2025, when annual growth reached 41.7%.
The cooling trend is particularly noticeable in Tirana. In the capital, the price index has remained unchanged over the past six months, and annual growth stood at only 4.4%, whereas in the first half of 2025, prices in Tirana rose by 32.6% year-over-year. According to market data, half of all transactions in the capital are now being concluded at a discount to the originally asking price.
At the same time, the coast is so far preventing the market from slowing down even further. Price growth in resort areas, including Vlora, Saranda, and Durres, is driven by foreign demand for seaside apartments and new tourist complexes. The Bank of Albania notes that coastal regions were the main contributors to the overall growth of the price index.
The paradox of the market is that demand is weakening, yet construction continues at a rapid pace. Albanian media, citing indirect tax data, report that permits for approximately 2 million square meters of construction may have been approved in the first five months of the year—a figure close to the record levels seen in 2024.
The practical conclusion for investors is simple: Albania no longer appears to be a market where prices are rising at the same rapid pace everywhere. Tirana has already approached its price ceiling, and further growth increasingly depends on project quality, location, and foreign demand. The coast remains stronger than the capital, but even there, the risk of overheating is increasing.
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