On the 16th of June France’s resort chain Club Méditerranée declared that it has quit its project for the operation of a holiday complex in southern Albania due to long dispute over land ownership.

‘There’s no project for a Club Med in Albania,’ Florence Le Gall, Club Mediterranee’s director of regional development, wrote to villagers claiming ownership of the land at Kakome, about 200 kilometres south-west of the capital, Tirana.

This is a real blow to Albania’s hard work in attempting to attract major Western investment and tourists. At the same time this is also a clear indicator that there is a problem with land ownership in certain areas of Albania.

The European Union (EU) has in the past urged Albania to solve the problems over land ownership in order to attract foreign investors and meet the requirements for membership in the EU.

The 75 Million Euro holiday complex was to be built by Albanian construction company Riviera and operated by Club Med. It is understandable that after a long 5 year dispute Club Med has decided to cancel its project in Albania.

Above is an illustration of the planned holiday complex that was canceled.

It is difficult point a finger and decide who was to blame for this, however the site was supposed to be public property and there shouldn’t have been a dispute in the first place, although the locals think otherwise. It is also clear that the Albanian government needs to work harder in solving such issues.

At times land ownership problems can be avoided by just asking the locals about the property as most of them will be well informed. If you seek sufficient advice and research before you buy a property you will certainly make a safe and profitable investment.

The majority of investors do not have such problems as they invest in apartments and property in major cities where the government regulates heavily.

The mortgages in Albania are astonishingly popular. At present, there are 17 banks that offer mortgage loans in Albania. Every one of these banks is foreign owned. The benefit of this is that foreign nationals can also secure mortgages in Albania under comparatively affordable terms and conditions. With the growth of the Albanian real estate market, it is anticipated that the mortgage industry in Albania would advance towards a promising future.

Albanian Mortgage Market Highlights

- Usually, interest rates range between 7% and 8.5%
- 70%-80% LTV finance is offered
- Loans are offered for terms of 25 and 30 years
- Self-employed individuals can secure mortgage loans
- Upfront costs equivalent to 2%
- Interest-only mortgages are also offered

The time required to secure a mortgage in Albania is extensive and the procedure might be bureaucratic in nature. Though in the past few years, it has been noticed that the procedure has bettered considerably since the banks/lenders are becoming accustomed to transacting with the foreign nationals. If you obtain a mortgage in Albania, there might be some hidden costs/fees.

If you are thinking about buying a real property in Albania, mortgages in Albania are normally available for the Albanian citizens and the majority of foreign nationals. You can secure a mortgage for either buying a house or refinancing for the purpose of home renovations and other objectives decided on a case by case basis. Mortgage loans in Albania are usually offered in two types: interest-only mortgage and repayment mortgage (interest and principal). The lowest amount offered is €30,000. Nevertheless, there is no maximum limit but the loan amount should not go above 70% of purchasing price or property valuation.

Furnishing of proof of income is necessary under all circumstances. This comprises investment, pension, salary income or rental income. It is not necessary that the lender would take into consideration all of them while ascertaining the maximum loan amount that can be offered. At present, non-status loans are not provided.

Important Mortgage Lenders in Albania

Following are the names of the prominent mortgage lenders in Albania:

- American Bank of Albania
- Credins Bank
- Alpha Bank
- Tirana Bank
- Banka Kombetare Tregtare
- Credit Bank of Albania
- Pro Credit Bank
- Banka Popullore

A major milestone was recently reached in construction of the highway connecting Albania and Kosovo. This major milestone was a 5.6 kilometre tunnel which is part of the Rreshen-Kalimash road – one of the segments 170 kilometer Albania-Kosovo motorway.

The celebration ceremony was attended by Albanian Prime Minister Sali Berisha and his Kosovan counterpart Hashim Thaci. For the Albanians in the Balkans this is a major development connecting two Albanian countries and making the movement of people as easy as possible.

In his speech Berisha said “We lived today one of our wildest dreams. We did not tear down a wall today, rather a mountain that separated us”.

The motorway will create an important link with the Balkan’s main port Durres. This major infrastructure project will cut the journey time from Kosovo by 4 hours making it just a 2 hour drive.

Here are some the key facts about this project:

- About €51m ($72m) economic benefit

- 2000 Albanians working on the motorway

- €1bn ($1.4bn) the total cost of only the 61km Rreshen-Kalimash section

This has also led to a corruption investigation due to the high cost of the Rreshen-Kalimash section due to costs nearly doubling from.

Source: http://www.nce.co.uk/