Despite decreasing demand, Albania continues to build, in what seems to be a saturated market of secondary houses for Albanians.
According to Deada Hyka of Monitor, a weekly business magazine in Tirana, the secondary housing market has turned into a headache for the building industry, a ‘hostage’ for the investors in under-developed areas and a nightmare for real estate agencies who don’t seem able to sell more.
Lack of market research produced a boom of building without any planning vision, and when coupled with several informal areas without proper documentation, the market is in a disarray and insecure state. 22% of apartments are empty, compared with 11.3% in 2001. Most unsold apartments are found in coastal areas of Durres, Vlora and Saranda while those around Tirana are mainly apartments built without proper legal infrastructure.
At first, people bought houses or apartments in Durres, Vlora or Saranda in the coast. Later on, the market developed towards suburban villas around Tirana, which prompted owners to sell their secondary residences by the coast which were being underused. Meanwhile interest from foreign buyers is still low as Albania needs to do a better job in marketing itself while the global economic crisis has affected sales across the continent.
Arben Dervishi of the Builders Association says that the Government should pursue a better tax policy which will decrease prices and then should let the market breathe through properly studied new building permissions in those areas where urban development is needed. Meanwhile, Dervishi says that there where they have allowed bad building, the Government should make use of such buildings for homeless people and those in need.
Despite concerns, Albania is increasingly evaluated as a good destination to buy a holiday home, as the country boasts 180 days of sun a year, a low cost of living, sandy beaches and a landscape laced with Greco-Roman antiquities.
A fledgling international property market is developing in the small country which sits next to the Adriatic sea, nestled between Greece and Montenegro, with property prices increasing by around 20 per cent annually for past five years, and are expected to hot up further if Albania is allowed into the European Union.
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