Published on and written by Cyril Jarnias
Albania, a Hidden Gem of the Balkans for Real Estate Investment
Albania, often considered a hidden gem of the Balkans, is increasingly attracting the attention of real estate investors seeking opportunities in Southeast Europe. With picturesque landscapes and a growing economy, the country offers attractive conditions for purchasing real estate compared to some of its neighbors.
Comparison with Neighboring Markets
This article compares the attractiveness of the Albanian market with that of bordering countries such as:
Analysis Criteria
We examine several key aspects:
Good to know:
This analysis will help you determine which destination might offer you the best return on investment.
Positioning Albania Against Its Neighbors
Albania positions itself as an attractive option for real estate investment in the Balkans, with particularly competitive prices compared to its neighbors. In 2025, the average price per square meter in urban Albania is estimated at around €2,252, with a range from €1,200 to over €3,500 depending on the area. However, other sources indicate a lower average price, around €1,143 per square meter for new buildings, making it the cheapest country in the region.
In comparison, the real estate market of neighboring countries shows significant differences:
| Country | Average Price per m² | Recent Trend | Special Features |
|---|---|---|---|
| Albania | €1,143 – €2,252 | +4% (lowest regional increase) | Strong tourism growth |
| Montenegro | €1,240 – €2,500 | Rising | Attractive to foreign investors |
| Kosovo | €1,300 | +22% in one year | 3rd most expensive in the Balkans |
| North Macedonia | €1,270 | Limited data | Mid-range position |
| Croatia | Up to €3,000 | Strongly rising | Most expensive in the Balkans (€2,270) |
| Serbia | €1,980 | Comparable to Montenegro | 2nd most expensive in the Balkans |
| Bosnia and Herzegovina | €1,100 – €1,150 | Limited data | Less developed economy |
The Albanian real estate market has experienced remarkable growth in recent years, driven by an improving economy and growing interest from foreign investors. This trend is particularly visible in Tirana and along the coastline, where increasing tourist demand is pushing prices up.
Several factors influence the real estate markets in the region:
The rise in construction material prices since the start of the Russo-Ukrainian conflict has also impacted the entire region, with varying increases depending on the country. Kosovo notably experienced a significant 22% increase over one year.
In terms of overall attractiveness, Albania stands out for:
This combination of competitive prices and development prospects makes Albania a particularly interesting option for investors looking to diversify their real estate portfolio in the Balkans, while benefiting from significant capital appreciation potential in the medium and long term.
Good to know:
In 2023, real estate in Albania remains one of the most affordable in the region, with prices per square meter lower than those in Greece and Montenegro, but comparable to those in North Macedonia and Kosovo. The Albanian market is experiencing moderate growth, supported by increasing demand from foreign investors and a limited supply of new construction. In comparison, Greece and Montenegro show stronger demand but also face more severe supply constraints, leading to price increases. Economically, Albania benefits from relative stability and tax incentives favorable to real estate investments, despite some political and legal challenges. The country’s attractiveness is strengthened by improvements in infrastructure and security, with a developing transportation network, offering potential buyers a competitive living environment compared to its neighbors.
Real Estate Taxation in Albania and Neighboring Countries
| Country | Property Transfer Tax | Property Tax / Annual Tax | Capital Gains / Rental Income Tax | Tax Incentives/Foreign Investors |
| Albania | Notary fees + agency commission | 4% to 8% of price per m² (new residential projects) | Rental income taxed at 15% | Simplified procedures; planned shift to taxation based on the property’s real value from 2028 |
| Montenegro | Approximately 3% of purchase price | Low annual property tax, varies by municipality | Capital gains taxed at approximately 9%; rental income also taxed around 9% | Foreign investors treated as nationals for property purchase, no specific known incentive |
| Greece | Transfer duty: ~3% | Property tax (ENFIA) progressive based on value and area | Capital gains: exempt if held >5 years, otherwise progressive rate up to ~15%; rental income between 15–45% | Golden Visa for purchase >€250k, partial exemptions possible depending on investment type |
| North Macedonia | Transfer tax: ~2–4%, depending on municipality | Low municipal property tax | Capital gains taxed at a flat rate (~10%); rental income also subject to ~10% | Favorable conditions for foreigners, but no notable tax exemption |
| Serbia | Property transfer duty: approximately 2.5% & additional notary fees | Local property tax (0.1–0.4% of cadastral value/year) | Capital gains taxed around 15%; rental income also taxed (~20%) | Purchase open to foreigners under reciprocity conditions or by establishing a local company |
Main Differences
Transfer tax rates:
- Relatively similar across the region (between 2.5 and 4%), except Montenegro which is slightly higher.
Annual taxation/property taxes:
- Albania applies a significant tax (up to 8%) on new residential projects, while other countries favor a moderate annual tax based on cadastral value.
Taxation on capital gains and rents:
- Albania imposes a relatively low fixed rate on rents (15%), comparable to Montenegro and lower than some Greek or Serbian scales.
- Greece offers full exemption if held >5 years, which is rare among neighboring countries.
Incentives/foreign investors:
- Greece stands out with its “Golden Visa” program granting residency rights for significant real estate investment (>€250,000).
- Other countries do not offer major tax advantages specifically reserved for non-resident investors.
Common Points
- Administrative procedures are generally simplified in all these countries to attract foreign investment.
- No major barriers are imposed on non-residents for real estate acquisition outside agricultural or sensitive border areas.
Starting January 2028 in Albania, tax calculations will be based on the “real value” of the property, which could lead to an effective increase in levies during purchases or transfers.
Investors must therefore consider not only the initial cost related to notary/transfer taxes but also the potential evolution of annual levies on assets held in each of the compared markets.
Good to know:
In Albania, the acquisition of real estate is subject to a property transfer tax of around 3% of the deed value, and an annual property tax proportional to the property’s area. Comparatively, Montenegro imposes a rate of 3%, similar for the transfer tax, but offers relief for first-time buyers. In Greece, the transfer duty rate reaches 3%, accompanied by an annual property tax, with possible exemptions for certain social groups. North Macedonia offers a transfer rate of 2% and applies lower property rights to attract foreign investors. Finally, in Serbia, this rate is 2.5%, but some households in disadvantaged areas benefit from tax relief. These variations imply that investors must consider not only initial costs but also ongoing charges, offered incentives, and the potential impact on the long-term value of their investment.
Real Estate Market: Advantages and Disadvantages by Country
| Country | Price/m² (2025) | Price Trends | Local Regulations | Property Availability | Political/Economic Stability | Growth Prospects | Taxation and Financing | Rental Demand |
|---|---|---|---|---|---|---|---|---|
| Albania | €1,200–€3,500 (avg. €2,252 in Tirana) | +47% in Tirana (2021–2023), dynamic market | Relatively open to foreigners, simple formalities, but attention to land title transparency | Significant supply in major cities and tourist areas, relative shortage of affordable housing in Tirana | Sustained economic growth, relative stability but dependent on regional context | Strong growth expected in urban centers and tourist coastlines, high speculative potential but possible volatility | Moderate interest rates (~4.9%), favorable taxation for non-residents; accessible banking procedures with required down payment | Growing rental demand driven by international tourism and urban expansion; interesting short-term yield in Tirana or on the Adriatic coast |
| Greece | National average: ~€2,400/m²; Athens center: ~€2,250/m² | Solid recovery (+6.8% year-on-year), steady progression after the financial crisis | Clear procedure for foreigners; purchase taxes around 3%, moderate annual property tax | Diversified supply in both old and new, especially in major cities and sought-after coastal areas | EU member state, politically stable since the end of the major economic crisis years | Gradual growth of the real estate sector stimulated by foreign investment and the return of tourism | More accessible financing via Greek or European banks for EU residents; attractive tax regime for expats through the “non-dom” scheme | Strong demand in Athens/Thessaloniki/tourist coasts thanks to the post-pandemic tourism rebound |
| Montenegro | From ~€1,500/m² outside Podgorica up to >€3,000/m² on the Adriatic coast | Upward trend for several years driven by Russian/Middle Eastern investments – steady progression even if less spectacular than Albania | Simplified procedures for foreign investors; low property taxation |
For an investor seeking a balance of security/immediate profitability — prioritize major Albanian or Greek coastal cities. For an “early adopter” profile betting on strong future potential: observe the Montenegrin coast or Skopje city center.
Good to know:
Albania offers competitive real estate prices compared to Greece, Montenegro, and North Macedonia, with relatively flexible purchase regulations that attract foreign investors. Prices are more affordable, although the market lacks transparency compared to Greece, which benefits from strong rental demand and a market capped by higher taxation. Montenegro presents growth opportunities, despite its limited market size and tourism dependency. In North Macedonia and Kosovo, economic and political stability remains uncertain, but transaction costs are low. In Albania, financing facilities are developing, which, combined with ongoing economic reforms, could stimulate the market. Rental demand is rising, although the market in Greece is mature, offering better return on investment opportunities.
Economic Factors Influencing Real Estate Investments in Albania and Its Neighbors
The Albanian real estate market shows a dynamic of sustained growth, driven by several favorable economic factors. In 2023, the Albanian economy recorded GDP growth of 3.5%, after several years of average progression around 5.8%. This economic vitality is directly reflected in the real estate sector, especially in Tirana where prices experienced a spectacular 47% increase between 2021 and the end of 2023.
Tourism is an essential driver of this growth, with 8.3 million visitors in 2023, strengthening demand for short-term accommodation, particularly in coastal areas like Durrës and Vlorë, as well as in the capital.
Real Estate Price Trends in Albania (2024-2025)
| City | Average Price per m² | Annual Variation | Special Features |
|---|---|---|---|
| Tirana | €1,200 – €2,160 | +47% (2021-2023) | Prime neighborhoods up to €2,160/m² |
| Sarandë | €1,500 – €3,500 | +12% (2023-2024) | Forecast +8% in 2025 |
| National average | €2,252 | Varies by region | Range from €1,200 to €3,500 |
The first quarter of 2025, however, reveals some nuances in this upward trend. The number of building permits decreased by 17% compared to the same period in 2024, with 258 permits issued. The planned construction area also fell by 6.3%. Paradoxically, the value of construction projects increased by 47.6%, reaching 20.1 billion lek compared to 13.6 billion a year earlier.
While Tirana remains the epicenter of construction activity with 72 new permits and an area of 201,237 m², there is a gradual shift of investments towards other regions such as Durrës, Vlorë, and Fier, which are recording significant increases in project value.
The residential sector dominates heavily with 188 permits out of 258 in the first quarter of 2025, for an area of approximately 215 m². Non-residential constructions (hotels, shopping centers, industrial units) complete this picture.
An emerging factor in the Albanian real estate market is the rise of energy-efficient properties, with a predicted 15% increase in energy certifications by the end of 2025, reflecting a gradual modernization of the housing stock.
The attractiveness of Sarandë deserves special attention, with prices expected to increase by about 8% annually in 2025. The construction of a new international airport in 2025 is expected to accentuate this trend, reminiscent of the real estate boom observed in Tivat, Montenegro after similar developments. The high profitability of short-term rentals is a strong argument for investors in this region.
The evolution of the Albanian real estate market reflects a country in full economic transformation, where tourism development and infrastructure improvement create investment opportunities, despite some signs of slowdown in the construction sector.
Good to know:
In Albania, real estate investments benefit from stable economic growth of around 3.6% in 2023, and relatively advantageous tax policies compared to Greece, which, although more tourist-oriented, faces inflation above 4% and high mortgage interest rates. In North Macedonia and Kosovo, less restrictive regulations attract investors despite slower economic growth rates of 2% and 3% respectively, however limiting urban development prospects. Montenegro appeals with its pro-investment reforms and growing tourist appeal, despite a slightly unstable economy. Investors must weigh the comparative political stability of these nations: Albania and Montenegro enjoy better stability than Kosovo, where political and economic dynamics remain tense.
Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
