The apartment rental market in Tirana and the price increase in recent years
From the verification and comparative analysis of construction prices and especially the rent price of apartments for living in Tirana, we have produced some data calculated according to the rent value in 2017 and in 2022. This analysis first focuses on influencing elements and further on the comparison of values.
In our summary commentary on the determination of rental value we think that there are several factors that are considered before setting the rental prices of an apartment.
In an order not necessarily according to the importance of factors, it can be said that in deciding on renting, apartment owners are influenced by:
1. The area in which the apartment is located. Regardless of how good the quality of the construction may be, if it is in an area not near the center and with a low level of services and shopping centers, but also with low demand for housing, then the price is lower.
2. Layout and construction quality. If the apartment has unsuitable architecture, unfavorable layout, low quality of refinishing, as well as unusable surface/corners, even though it may be in a preferential area, its price will be discounted.
3. Proximity to various institutions according to the type of requirements (schools, kindergartens, nurseries, shops, services, parking, greenery, etc.) with easy access, which offer everything necessary for each customer category, are consequently more favored and affect price increase.
4. The age of the apartment and the investment that the apartment has, so if we are dealing with an apartment located in an existing building or a shop as well as a new apartment, its value increases if the investments made in it are recent and moreover if there are thermal insulation elements, etc. related to energy efficiency.
5. The position of the apartment within the building has an impact on setting the rent price. If the apartment is on the top floor, its value may be discounted. This is also for technical reasons. Being on the terrace, the problems of staying are estimated to be higher than in the case of the floors below since the terrace has a certain depreciation period.
6. Depreciation. Apartments before the nineties always have a lower price compared to the apartments of recent years for several reasons such as the lack of an elevator, the depreciation of the building, the old typology of the apartment, the need for interior interventions, problems with water, the Internet, as well as the lack of the thermal insulation system, which is used in new buildings.
7. Taxes and various tax rates. Their influence on the rent price is an influencing factor as weighty as the value of taxes and fees that are paid according to legal regulations by the tenant, or by the landlord.
However, we must mention the fact that the construction market in Tirana, being dominated by financing from informal money and less formal money, does not follow the inclusion of factors in setting the rental price of apartments. Even though this did happen regularly a few years ago, due to the influence of the regulatory effects of the state, but also due to the self-regulation of the market, there is an assessment in prices by calculating these elements as well.
In the assessment of the apartment rental market in Tirana in the period 2017 – 2022, the data from the market published by the real estate offices and the media were taken as a point of reference [1], research [2] and from data from INSTAT, as well as government decisions on the minimum rent value for the purpose of determining withholding tax [3].
Based on the data averaged in 2017, as well as based on the data of rent prices in the year 2021[4] – 2022[5], according to the table below,
| Tables of average apartment rental prices, 2017 -2022 | ||||||
| Name of the Area in Tirana | Ap. 1+1 (euro/month) | Ap. 2+1 (euro/month) | ||||
| Year | Average | Year | Average | |||
| 2017 | 2022 | change | 2017 | 2022 | change | |
| Central Area of Tirana | ||||||
| Ex – Block Area | 300 – 500 | 550 – 700 | up to 61% | 450 – 650 | 600 – 900 | up to 30% |
| Stadium “Air Albania” | 300 – 500 | 550 – 700 | up to 61% | 450 – 650 | 750 – 950 | up to 53% |
| Artificial Lake | 250 – 400 | 450 – 550 | up to 58% | 250 – 400 | 450 – 550 | up to 40% |
| Elbasan’s Street | 200 – 400 | 450 – 500 | up to 81% | 300 – 450 | 550 – 750 | up to 70% |
| Stadium “Dinamo” | 300 – 400 | 400 – 500 | up to 29% | 350 – 450 | 550 – 800 | up to 67% |
| Durrësi’ Street | 250 -350 | 400 – 550 | up to 59% | 300 – 650 | 550 – 750 | up to 47% |
| Zogu i Zi | 200 – 300 | 400 – 450 | up to 75% | 280 – 450 | 450 – 550 | up to 41% |
| ex – Eksposition Area | 250 – 300 | 400 – 450 | up to 46% | 350 – 550 | 450 – 600 | up to 19% |
| Tirana Ring Road Area | ||||||
| Ali Demi | 200 – 300 | 350 – 400 | up to 54% | 250 – 350 | 380 – 480 | up to 44% |
| Komuna e Parisit | 200 – 300 | 400 – 500 | up to 80% | 250 – 350 | 430 – 500 | up to 53% |
| Porcelani | 150 – 200 | 250 – 270 | up to 45% | 250 – 300 | 350 – 400 | up to 48% |
| Hospitals Area | 250 -350 | 400 – 550 | up to 55% | 250 -350 | 400 – 550 | up to 58% |
| Don Bosko | 180 – 250 | 250 – 300 | up to 30% | 250 – 320 | 350 – 400 | up to 32% |
| Astiri | 200 – 250 | 300 – 350 | up to 45% | 260 – 320 | 350 – 400 | up to 29% |
| Kinostudio | 150 – 200 | 250 – 350 | up to 54% | 200 – 230 | 250 – 380 | up to 45% |
| Kombinat | 120 – 180 | 200 – 280 | up to 55% | 180 – 220 | 230 – 280 | up to 27% |
| Outside the Tirana Ring Road | ||||||
| Fresku | 150 – 200 | 200 – 250 | up to 27% | 220 – 240 | 240 – 260 | up to 8% |
| Yzberisht | 100 – 150 | 150 – 200 | up to 42% | 150 – 200 | 180 – 220 | up to 15% |
| Source: According to real estate agencies and media | ||||||
it results that the increase in rent prices in the last 5 years (2017-2022) is at the average levels from 11% to 58%.
The change in rental value in 2022 compared to 2017 for 1+1 apartments is higher in Elbasan Street (up to 81%) and lower in Fresku (up to 27%)
If we look at this average difference according to the areas of Tirana (see the table below), it results that:
| Name of the Area in Tirana | Ap. 1+1 | Ap. 2+1 |
| Average change | ||
| 2022 vs. 2017 | ||
| Central Area of Tirana | up to 58% | up to 45% |
| Outside the Tirana Ring Road | up to 52% | up to 42% |
| Tirana Ring Road Area | up to 39% | up to% |
The change in rental value in 2022 with 2017 for 1+1 apartments is seen to be higher than for 2+1 apartments.
Since the rental market follows the logic of the real estate market, according to an analysis of the latter carried out by ALTAX [6] it is estimated that the rent price will continue to increase in Tirana, if there will be increased demand, but also the circulation of informal money. Which artificially increases the prices of apartments for sale, but also their rent.
[1] https://gazetaimpakt.com/ia-vlen-te-blesh-shtepi-per-ta-dhene-qira-ja-llogaritjet-per-tiranen/
https://acp.al/news/3070/Pas-shtrenjtimit-te-apartamenteve,-rriten-me-30-per-qind-edhe-cmimet-e-qirave-ne-Tirane/
[2] https://www.academia.edu/34090186/Kontrata_e_Qirase_se_Banesave_docx
[3] http://www.panorama.com.al/cmimet-e-reja-te-qirave-ja-sa-behet-tatimi-ne-tirane/
https://acp.al/news/1004/Cmimi-dysheme-i-qirase-se-dyqaneve,-sa-dyfishi-i-apartamenteve-te-banimit/
[4] https://www.monitor.al/nuk-ndalet-rritja-e-cmimeve-te-apartamenteve-ne-tirane-2/
[5] https://www.monitor.al/iken-shqiptaret-vijne-te-huajt-rriten-cmimet-e-qirave-2/
[6] https://altax.al/cfare-pritshmerie-mund-te-kete-per-tregun-e-pasurive-te-paluajtshme-dhe-qiradhenies/
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