Construction Permits in Tirana Reach All-Time Highs in Q1 2022 – Release
The number of construction permits in Tirana in the first quarter of 2022 is half of the total issued throughout 2021, signaling a significant increase.
As the construction boom in the capital continues, some 800,000 square meters of building permits were issued between January and March 2022, more than double the same period in 2021.
In terms of permits issued in Albania as a whole, the majority, some 77%, were issued in the capital. According to the data, the value of permits issued for construction and engineering works is around 235 million euros, while for the whole of 2021 it was 470 million euros.
Number of building permits issued so far this year up 36%
A total of 397 permits were issued in the first three months of the year across Albania, an increase of 58.2% over the previous year. This equates to some 1.03 million square meters of new real estate, which is 72% more than in the same period of 2021.
The figures for 2021 were already significantly higher than in 2020, doubling in Tirana. Data from the first quarter of last year showed that the number of permits increased by around 36% compared to the previous year.
The sheer volume of money pumped into the Albanian construction sector has sparked the interest of those involved in monitoring illicit money flows. The Global Initiative Against Transnational Crime (GIATOC) estimated in 2020 that up to €700 million of illegal money enters the country every year, most of which goes to the construction sector.
The construction boom has led to a significant increase in purchase costs and rental costs. In some cases, real estate prices have soared by as much as 70% over the past five years.
Tirana: a city scarred by money laundering
Currently, the average property price in Tirana is 1143 euros per square meter, increasing on a monthly basis. Property inside Tirana’s Ring Road starts at EUR 1300 per square meter and can reach EUR 3000 or more in highly sought-after areas or luxury developments. Meanwhile, in suburban areas, the average price is 1000 euros per meter.
Data has been published by Keydata Albania and is a private index of real estate prices in the country. They looked at average and media prices across the city which they divided into three divisions; inner ring, outer ring and Blloku.
Between 2020 and 2022, the average price across the city increased by 100 euros per square meter, from 16 euros in the first quarter of 2022.
A realtor working for a citywide brokerage said demand was high and continuing to rise. When asked who was buying properties, he explained that they were seeing a lot of interest from investors.
“They buy real estate before it’s even built, several apartments at a time. Then sell once built to make a profit. Others buy apartments to rent to foreigners,” he explained.