According to the Bank of Albania, the progress of the index of house prices is mainly determined by the highest reported prices, especially for the central areas of the capital, those in coastal cities and other areas have not shown significant changes.

The data of the Bank of Albania show a revival of the market during this year, as the increase in prices was restrained during 2023 (with annual growth of only 3.2% in the second 6 months). However, as happened in previous periods, the Bank of Albania emphasized that the increase in the average price may have been influenced by the increase in the share of transactions in the most expensive areas, such as the central area of ??Tirana. Properties sold in central areas accounted for about 46% of all sales volume reported this period and this share is higher compared to previous periods.

This situation has had a significant impact on the value and performance of the index also at the national level, given that about half of the sales were made in areas with historically higher prices than those of other areas. On the other hand, lower sales prices compared to previous periods were reported in areas outside the capital.

It should also be noted that the total number of properties sold was 928, lower compared to the previous six months. Also, the average number of properties sold by each subject surveyed (construction firm or real estate agent) during the first half of 2024 resulted in about 5, from the value of 7 reported during the second half of 2023.

The ratio of the number of entities that made sales to the total number of valid responses decreased to 39%. This ratio has marked a gradual decline.

The fact is, however, that the increase in prices reported by the Bank of Albania coincides with a return of the increase in housing loans granted by the banking sector. For the first seven months of the year, the new home loan reached the historical record of Lek 31.6 billion, increasing by 17% compared to the same period a year ago.

According to the agents, about 53% of the residential and commercial properties sold by them were purchased with bank loans.

Agents have provided optimistic answers about the general situation in the real estate market throughout the country for the short-term horizon (the next six months) and are also optimistic about the longer term (over the next two years). The net balance of responses to the question on the medium-term future remains positive, in line with the long-term average. Also, the interviewed subjects expect price increases in aggregate: the net balances for housing and commercial properties were both positive by 11%.