Albania poised for property boom

Albania is a relatively young hopeful among Europe’s emerging property markets. The country, which only broke free from communist rule in 1992, has been working hard to make itself an attractive destination for overseas property investors. Infrastructure improvements, approval for membership of NATO and EU, no restrictions for foreign buyers and a flat tax rate of 10% are all adding up to a prospective investment location that is worth monitoring over the next few years.

Philip Bay, Regional Director of Colliers International Southeast Europe, said, “We have actually been operating here for many years. We are very confident that Albania has a bright future and can look forward to sustainable growth. The country is at an early state of real estate development and will become an attractive market in three to five years.”

Albania’s economic growth during 2007 was around 6% and in the same year, the government approved a fiscal package which ticks all the right boxes for investors. It included a flat rate of 10% on personal income tax, corporate tax and capital gains tax, no VAT on property purchases with foreigners allowed to own 100% of Albanian companies. In addition, the country has some of the cheapest property prices in Europe, with annual price growth of around 30% year-on-year in the capital,Tirana and coastal regions, indicating all the right ingredients of a newly emerging property market on the cusp of a boom.

As any seasoned investor knows, access is vital and Albania is currently making major infrastructure improvements with the help of loans totalling more than €90 million from the Japanese and Austrian governments. The money is being used to make a broad sweep of improvements which will include upgrading the main Albanian port of Durres which is 35km from Tirana and an important link to the country’s Balkan, Black Sea and EU neighbours. Tirana International Airport was upgraded in 2007 when improvements included a new terminal building and airport access roads. The airport now has a capacity of around 1.5 million passengers and offers direct flights to and from London, New York and a range of European cities, attracting tourist and foreign investors from around the world.

James, Gonzalez, Market Analyst at Obelisk, highlights the increasing amount of foreign investment in Albania as a major indicator for the growth of its property market. “Within the last 5 years the number of commercial buildings springing up on the main road which runs between the airport and the city of Tirana has grown considerably and companies such as Hewlett-Packard, Peugeot, Citroen have moved in. Vodafone have been in Albania since 2001 and earlier this year announced that it was expanding operations there. I think this is definitely one to watch.”

For more information, visit obeliskinternational.com