It may be hard to believe that Albania is so poor, as its location really predicts the opposite. The country is located in a beautiful part of Europe with a fantastic position that has a coastline of the Adriatic Sea. As well as this, the southern part of the country is only a very short ferry ride from the popular Greek island of Corfu. This is an island that has a booming tourist industry and has many resorts and hotels in which tourists from all over the world stay in.

However, the main reason for Albania being so low on tourism is more than likely due to its history. The country has a history in which there was an extreme dictatorship and communism and it is said that these are the main reasons for foreign buyers being put off the country. Of course, like many countries that are aiming to join the European Union, things are changing, although it seems they aren’t changing as past as people might like.

Having said this, the economy is developing in Albania and there are now certain places of the country in which buying property could certainly see a good return on an initial investment. A lot of people still believe that it is too early to consider investing in the country, however, places like the capital city Tirana are slowly becoming a great place to invest in. There are hundreds of new resorts planned in the year of 2010 and some of them have even begun being built already.

Although the country is becoming much more stable, you should still be extremely careful when investing in Albania, but if you are careful, there is certainly a lot of money to be made if you buy the right property in the right place.

One of the biggest issues when buying property in Albania is that you need to make sure that the title deeds of the property that you are going to buy are checked over by an independent lawyer. This is because in Albania, around 15% of the property there is not legitimate and the property does not belong to the true owners. If you buy a property and the title deeds did not state the true owners name before you bought the property, then the property can be taken off you and you will lose all of the money you paid for the property. Currently, this is especially important in places such as Tirana and the coastal towns as this is where most of the property that is not legit is located.

Another thing to be careful of when buying property in the country is that you need to check that the building you are looking to buy is legal. There is a history in Albania of building being built without permission and are therefore illegal. Buying one of these properties could see you lose a lot of money so make sure to check with the state that the property you wish to buy is all above board.

One other thing to be careful of in Albania is the fact that the country has a high corruption rate. Although this is being combated by the new government that came into power in 2004, it is still a big issue in the country and something to be careful of.

The post was by an Albania based estate agent and it explained that in particular, Tirana had actually done the best with a growth of 5% on prices during the year 2009 and it explained that this is expected to grow even further during 2010.

The rentals market was mentioned in the post too, and the firm explained that Tirana has some of the best yields with more than 10% being achieved. In most of the coastal towns the normal yield is around 7% meaning that Tirana is already achieving yields far higher than average and with the holiday season now in full swing, this is expected to get even higher.

It was also said on the post that the rental management sector is extremely new to the Albanian country and that only new commercial projects in the country are providing management.

The post also commented on the security of the market saying that there is no longer the problem of illegal buildings being built in the country. It said that government authorities are putting more and more effort into making sure that these illegal buildings do not get built and that they will penalise the people building them rather heavily if they find them. It was also said that because this has been an issue in the past, people are being much more careful and not taking risks when it comes to buying property so there is less chance of people buying these illegal buildings.

Lastly, the post commented on the new developments that are being built this year. There are many new developments that are currently being built in the country with many more proposed for the future. Some of these have being held back due to a lack of funding, however, these are only the larger developments.

‘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.

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

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/

The country itself is quickly becoming known as the last, and possibly best, market on the continent that has not yet been exploited to its full potential. The heart of the country, its capital of Tirana, is in the midst of a massive economic boom as buildings, tourist attractions, hotels and a major airport are all being constructed. All major investors are predicted extreme economic growth in the area due to an increase in tourism. More and more people are starting to take notice of this uncultivated jewel along the coasts of the Adriatic Sea.

In hindsight, Albania offers all the advantages that can be found in other major tourist hotspots within Europe but at a fraction of the price. This is a statistic that will not be present for long. Over the past few years, property prices within the country have risen on an average of about 20%, and up to 200% in some of the more popular areas. There are also predictions by many seasoned investors that the price will continue to rise up to 30% annually after Albania finally becomes part of the European Union.

As an expat or foreign investor, there are no restrictions that are applied to your investment opportunities within Albania. On top of this, purchase prices are extremely low in comparison to other areas, while rental costs are significantly higher. As the market for tourist continues to rise, so will your investment in Albanian property.

The time is now to get involved is this relatively unknown investment hotspot. At the moment property prices are some of the cheapest that anyone can find in all of Europe. However, as tourism, construction and development continue to grow at a rapid pace these prices will not be in existence for long. Albania has a wealth of potential resources and untouched capital that are ripe for the picking. Investment is all about timing, and if you want to take advantage of this unexploited market, you are going to have to act fast.

Top apartments, getting built over the cash-rich oceanic plots, are all making due emphasis that the rooms open up to the beautiful ocean providing a panoramic view. There is nothing more beautiful than the setting sun into the ocean. At Vlora, you get to pay well for the real estate and deserve every bit of care that you are handed.

There is need to have proper papers, a bona fide citizenship and most of all, money. If you have a pre-approved housing loan, you can negotiate heavily, as your bank secures your way of payment. Chances are that you will cut a huge bargain. You should check out that apart from the sea and sand and the view of Sazan Island, a ubiquitous sight at Vlora, you have all the amenities too.

Picture of Vlora City

There have been major developments especially with regards to road construction and maintenance, airports, ports of entry and telecommunication systems. All this public investment has created a very healthy and positive environment to lure foreign investors.

When it comes to energy developments and environmental concerns, not much has been done within the country for close to 30 years. However, the government has recently set in motions to construct an all new and high tech thermal energy plan within its borders. Increased investment and building developments have put an increased strain on the energy infrastructure within the country and this project should help a great deal in alleviating the concerns.

Although there have been a number of obstacles to overcome in the post-communist environment in Albania, the construction industry within has become an economic powerhouse. Necessary construction caused by periods of civil unrest and an increase in United Nations financial support has allowed the construction industry to become a staggering success. Foreign investment has paved the way for new developments such as the Kukes airport, the creation of the ports of Durres and Vlore and tourism has created the need for a new wave and hotels and activity facilities.

The tourism industry alone has made it possible for all these developments to occur and the amount of visitors to the country each year is still on the rise. Easier access to the country through the construction of the Kukes airport and new ports will continue to draw more and more tourists to the country and thus, more foreign investment.

The new infrastructure developments within the financial sector have increased the appeal of Albania to foreign investors. Hotels and tourist attractions have been springing up all over the country in order to attract tourists to the beautiful coastline and historic culture that are inherent in the country. The infrastructure that has recently been put into place fully protects foreign investments and has been the building block for the country’s recent success.

The buying procedure in general involves signing numerous contracts – first a reservation contract, an undertaking contract, an introductory contract and the concrete sale-purchase contract.

Once signing the reservation contract, the property is reserved for approximately 4 weeks by the buyer. This time is then used by the buyer (through the lawyer) to carry out careful checks on the property.

Although there is no obligation to have a lawyer for a property purchase in Albania, it is always suggested to use one. During the communist era (before 1990) a lot of property was confiscated by the government. However since the 1990s roughly 85% of the confiscated properties have been returned to their original owners. The outstanding 15%, situated primarily in Tirana and coastal areas are still in the process of being resolved.

To prevent a familiar problem when buying property in Albania it is highly recommended that the buyer’s lawyer must certify that the property in question is really in full ownership of the present seller and is free from any liens.

The quality of construction is also an issue at times. This is due to the fact that some developers decide to take shortcuts when building.
Once all the required documents are obtained, the ‘undertaking contract’ is signed by the buyer and seller. This indicates their agreement to buy and to sell the property in that order. And usually would include information of the timescales, payment conditions, and price conditions of the acquisition. The undertaking contract is signed in a Notary office; this is where a public official is appointed by the government to notarize legal documents.

It is usually common practice that once the introductory contract is signed a 10% down payment is paid for second hand properties. Off-plan developments usually require a bit more as down payment, this could be anywhere between 20%-40%.

To get to the final sale-purchase contract the property needs to have been paid for fully and then the contract can be signed in front of a Notary. To finalise the sale and for the titles deed to be transferred to the new owner the final contract is then registered at the Office of the Immoveable Property Registration.