albania buyers guide

AlbaniaProperty Guide

Your Gate to……… Investing in Albania

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www.Albania-Estate.com ©

Albania Property Guide

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About Albania & Albanians International integration Economic data Why should I invest in Albania? Albanian Cities Questions & Answers Conclusion 18

Contents

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Albania covers a total area of 28,748 km², with a coastline of 362 km. Albanian Coastline borders in the Adriatic and Ionian Seas.

The territories of present day Albania have been inhabited as early back as 100.000 years ago. At the turn of the third millennium B.C. an Indo - European population settled there. As the result of the mixture, a population incorporating the unique cultural and linguistic characteristics of the whole Balkan Peninsula (pelages) was created.

Based on this ancient population, the Illyrian people developed through the second millennium and the first century B.C. After its fall in the year 30 B.C. Illyrian came under the control of Roman Empire. With the division of the Roman Empire (395 A.D), Illyrian became a part of the Byzantine Empire.

The country has suffered continuous invasions over the last 1000 years and by the end of the 14th century Albania was occupied by the Ottoman Empire.

Scanderbeg square in the center of Tirana – Capital of Albania

Location of Albania in Europe

Map of Albania

History of Albania

About Albania and Albanians

TIRANA

MACEDONIAADRIATIC

SEA

IONIC SEA

KOSOVOMONTENEGRO

GREECE

Durrës

KavajaElbasan

Pogradec

Laç

Lezha

Peshkopi

Lushnje

Fier

Vlora

Saranda

Berat Korça

Tepelena

Shkodra

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Albanians fought successfully Ottomans during 1443-1468 under the legendary Leader Gjergj Kastrioti Scanderbeg. Ottoman Empire at its best was stopped by Albanians who saved Europe from the invasion. The subsequent efforts and insurrections for independence brought about proclamation of the independence of Albania in 1912. After 1912 till the end of the First World War, the country was attacked by neighboring countries.

After eleven years of monarchy the country was occupied by Mussolini forces in 1939, putting the end of monarchy. In 1943 the armies of Hitler occupied the country.

The resistanc e against foreign invasion was known as the Anti–Fascist National Liberation front. The Communist party took power in November 1944, when the foreign armies were expelled.

Shortly thereafter, a totalitarian regime was established under the communist leader Enver Hoxha. For about 50 years, the regime applied the policy of self-isolation, leaving the country in great economic poverty when it finally emerged from isolation in 1991.

The principle of self-reliance applied by the Communist reg ime prohibited foreign loans, credits and investment.

From 1991 untill 1997 the Democratic Party led the country. After the unrests of 1997 due to the failure of pyramidal schemes the Socialist Party with its coalition was in power until 2005. After the last elections on 3 July 2005 The Democratic Party with its coalition is turn back in power. Albanian policy intends to integrate the country into European Community and the Alliance of NATO forces.

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Albania has a population of 3.64 Million (est. July, 2009) but only 3.1 Million are residents and the difference is made of Albanian emigrants who live and work mostly in Greece and Italy. ❖ Median age ~ 30 years❖ Life expectancy at 78 years❖ Albanian capital: Tirana withapprox 900K inhabitants

Albania is a secular country. Albania is well known for its model of religious tolerance and this goes back centuries ago when Muslim religion was first introduced into Albania by the Ottomans. In the country live together Catholics, Orthodox, Evangelists and Muslims. According to the 2007–2008 Gallup polls, 63% of Albanians claim that religion does not play an important role in their life.

Butrint-Sarande− a unique cultural heritage

Total Albanians in region: 6 Million (est)

Albania: 3.1M

Kosovo: 1.87M

Emigrants 0.54M

0.52MMacedonia

Population

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Europe - Albania’s long time aspiration

Albania is a member of the UN since 14 December 1955

Paving the way for European Integration

Credit Insurance Rating

Parliamentary Democracy

Member NATO − April 2009

Albania to become a member of the European Union by year 2014-15

Political Risk: 3 (1 = best; 7 = worst),

Financial market: B1, Moody’s classified as a country of “stable outlook” (Mar. 2012)

The enactment rule of law is foundation of free society

All new laws are in accordance with western standards

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Albanian current Currency

Economic Indicators

Commercial Banks (2012)

Exchange r ate (August, 2012)

EUR/ALL 138 USD/ALL 110.4 EUR/USD 1.25

GDP - Real Grouth Rate: 2.5% (2011 est.)

GDP - per capita: $7,800 (2011 est.), $7,600 (2010 est.)

Inflation Rate: 3.9% (2011 est.), 3.5% (2010 est.)

Exports: $1,886 billion (2011 est.), $1.548 billion (2010 est.)Export Partners: Italy 50.8%, Kosovo 6.2%, Turkey 5.9%, Greece 5.4%Imports: $5.022 billion (2011 est.), $4.305 billion (2010 est.)Import Partners: Italy 28%, Greece 13%, China 6.3%, Turkey 5.6%, Germany 5.6%

Public Debt: 59.4% of GDP (2011 est.)Investment: 31% of GDP (2011 est.)

Alpha Bank – Albania

Intesa Sanpaolo Bank Albania Banka

Societe Generale (SG)

Credins Bank (CB)

Credit Bank of Albania (CBA)

Credit Agricole – Emporiki bank (CA)

First Investment Bank (Tirana Branch (FIB)

First Investment Bank, Albania sh. a. (FIB)

International Commercial Bank (ICB)

Italian Development Bank (IDB)

National Bank of Greec e (NBG) Banka

Kombetare Tregtare – BKT Procredit

Bank (PCB)

Raifeisen Albania (RZB)

Tirana Bank (TB) (Part of Piraeus Bank)

Union Bank (Albania) (UB)

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Albanian Southern Riviera – unlimited potential for development

Albania’s Infrastructure

Why should I invest in Albania?

Privatization, Concessions, Reforms BOT/PPP sectors & projects

Domestic economy & exports are expanding

Established trading patterns with the EU

Gateway to the Balkans Free Trade Area

Total labor costs are lower than comparable countries

Social security ‘on costs’ amount - 31% of gross wages

Adaptable and flexible skilled labor force

Extensive language skills, a lot of the younger generation are college graduates

Investment opportunities through privatization

Government assets / real estate properties (Feb 2010)

Road construction

The whole program is expec ted to finance 1,000 – 1,500 kilometers of roads(signed a crediting ag reement with the EBRD)

Energy

Hydro Power Plant

Renewable energy Health care

Water

Mines

Telecom infrastructures

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Construction Development in Tirana

Urban development in Tirana

Tirana enjoys a beaut iful setting between the ranges of Dajti Mountain from one side and the coastal plains on the other one. This relatively new city was founded

in 1614 by Sulejmen Pashe Bargjini, feudal lord of that time, and proclaimed capital in 1920. However the area has been inhabited as early back as the Neolitic period. With a population of approx 800,000 inhabitants, Tirana is growing rapidly, and is a busy commercial and adminis-trative center with several comfortable hotels, restaurants, discos, pubs as well as modern facilities for conventions and conferences. About 70% of the businesses are located in Tirana area.

It is always nice to have a walk in the Grand Park, lying in the southern part of the city and extending over an area of 250 hectares with an artificial lake included. It has 120 kind of plants, decorative shrubs and flowers of various colors.Albania Estate has a lot of properties for sale or for rent in the city of Tirana. Our agents in the city will be able to help identify great deals for our clients.

Tirana – Albania’s capital city

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Beach in Saranda

Seashore of Saranda, offers a unique atmosphere and style that steels the heart of all its visitors.

The sea panorama, the variety of flora, favored by the soft climate, make Saranda the preferred center for rest and recreation and an important tourist town.Most Albanian couples come to spend their honey-moon in Saranda. That’s why it is known in Albania as the town of the honey-mooners.

Saranda is situated in an open sea gulf, opposite the island of Corfu (Greece). Saranda is an animated town between the mountains and the Ionian Sea,61km south-west of Gjirokastra.

There are today, daily ferry services to and from Corfu.

Saranda is rapidly developing into the southern gateway for tourism into Albania.

In year 2000 Saranda was visited by 50 thousand foreign tourists and many more Albanian tourists.Near Saranda stood the ancient Illyrian city of Onchesmos, mentioned as a port in the 1st century B.C. In the 4th century A.C. the town was fortified with walls. Inside the walls have been excavated the remains of dwellings, water cisterns and an early Christian Basilica of the 5th and 6th century, containing a beautiful multicolored floor mosaic. Other mosaics are to be found in the district The ruins are also preserved of an early Christian Monastery, of the 40 Saints, from which the modern name of the town (Saranda) is derived.

Albania Estate has an in depth knowledge of the city of Saranda and the best properties Our office in Saranda will always be there to take care of our clients needs.

Saranda – The Pearl of the South

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museum.

for sale.


Durres is an ancient city, founded in 627 B.C. and known by the names Epidamnus and later on Dyrrachium.

The most important archaeological site is the Amphitheatre, the largest in the Balkan Peninsula, built in the 2nd century B.C. with a capacity of 15 – 20 thousaand spectators and containing an early Christian Crypt with rare wall mosaics.Worth visiting is also the fortress of Durres of the early Middle Age, V–VI Centuries.Durres is the largest beach and sea destination in Albania. With a coast of 6 km long and 150 –180 meters wide, only 30 km from Tirana. International Airport and 39 km far from the capital Tirana. Along the seaside there are tourist estab -lishments which provide adequa te services. Durres is the largest beach and sea destination in Albania.

With a coast of 6 km long and 150 –180 meters wide, only 30 km from TiranaInternational Airport and 39 km far from the capital Tirana. Along the seaside there are tourist establishments which provide adequate services. Durres is the second largest city of Albania with a population of 150,000 inhabitants which gets almost doubled during the summer!

It is the biggest seapor t and the main railway connec tion center. Located in the vicinity of international Airport of Rinas and the capital, Durres maintains regular connections with Italian ports.

Our properties in the city lies mainly on the beach area and it gives our clients the convenience of being close to Tirana International Airport which is only 20 minutes away

Durrësi – Albania’s oldest city

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“Cold Water” rocky beach in Vlora Beach in Vlora

The adorable Ionian riviera spans the whole length of Vlora

Vlora coast is situated in the southwestern part of Albania, exactly where the Adriatic and Ionian seas meet. Vlora, through the Otranto Channel, is the nearest point of Albania to Italy (72km). It is 135 km far from Tirana and 123km from Greece.

Along Vlora coastline you will find outstanding white beaches and stunning surroundings. Lots of beautiful beaches in places like the natural Park of Llogara, Dhermi, Palasa, Himare and Cold Water (famous for its rich clientele and natural water resources). Vlora averages 274 days of sunshine in a year. Albania Estate has several great offers from the city of Vlora. Our contacts on the ground are extensive and this city offers the luxury of being in the middle of the south of Albania. So you are equally close to Saranda or Tirana.

Vlora – Miles of White Beaches

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What is happening in the Albania Real Estate Market?

Do apartments come furnished?

How much is the Reservation / Agency fee?

What are the payment terms?

How can I instruct a lawyer?

What is the process after the initial reservation fee is paid?

What other costs do I need to be aware of?

Is there a need for car parking?

Approx how much are communal charges?

Are there any guarantees from the developers?

Now is the best time to invest in Albania

Questions and Answers

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YOUR GATEWAY TO..... ALBANIA REAL ESTATE MARKET!


OfficesIn the major office developments the last fifteen years the first office buildings were the Sky Tower of 8,000 sqm (2005), the Twin Towers of 11,800 sq m (2005), the European Trade Center of approximately 9,000 sqm (2006), the G-KAM center of 4,500 sqm (2008) and the Hekla Center of approximately 3,000 sq m (2009). During 2012, no new supply was added to the total office stock, which has been registered at 63,400 sq m since the first half of 2009 after the entrance of the ABA Business Center into Tirana’s Real estate market. Currently, the Grade A inventory comprises the largest proportion of office space with 34,300 sq m against 13,000 sq m of grade B+. 16,100 sq m Grade an office buildings in Tirana include Sky Tower, Twin Towers, the European Trade Center (ETC) and ABA Business Center. Nearly 80% of the business towers are located in the Central Business District. The remaining office stock is spread across the broad center and central Tirana.

Projects currently under construction are expected to increase the office stock by a further 238,700 sq m in the next 2-3 years, where Archea Tower is planned to be approximately 12,000 sq m, American BC nearly 3,000 sqm, Millennium BC 8,700 sqm, TID Tower 15,000 sq m and Tirana Business Park 200,000 sqmResidential

QA

What is happening in the Albania Real Estate Market?

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Residential property prices in Albania have not seen any changes in the past 2 years. The prices in Albania are quoted in €. New high-end residential developments maintain the highest asking prices of €1,100 - 2,000 per sqm and are located on the best areas. In the mid-market the prices range from €500-700 per sqm. The prices have been under pressure to go down and we have observed a decrease in prices in areas that have slow sale rates. But in the luxury areas there are still high prices and pressure from the buyers to lower it.

In the first half of 2012 there are issued almost no construction licenses in Tirana because of the municipality new reforms. There are many reasons why the supply has slowed down. Factors that contribute to this slow down are the lack of construction licenses, economic crisis in the neighbor countries from which Albania has the most remittances, slow development on completing the constructions by the builders and tougher financing regulations from banks and financial institutions.


It would be very unusual to find apartments being sold with furnishing.

Considering that competition is becoming stronger and stronger developers are more willing to offer furniture, higher quality works, and therefore accept lower margins. This is a positive sign, and we are witnessing more reasonable pricing and developers thinkign of offering more than just accomodation.

The Reservation/Agency fee is 2,000 Euro for apartments and Land fees 6 % on a sliding scale downwards. This fee is payable immediately on return of the reservation form. On receipt of this money and form, there is usually a cooling off period of 15 days, in case the buyer, should wish to not proceed with the purchase. On receiving of this fee Albania Estate communicates with developing company and takes the apartment out of the market. With the next step client can start the legal proceedings in order to finalise the undertaking contract.

Do apartments come furnished?QA

QA

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Land Market

The land market in Albania has increased throughout the years due to the buyer’s interest in bigger areas, mainly for construction of tourist complexes. The agro land asking price vary from €15- 200 per sqm depending on the position, also in relation to the main roads.The industrial land asking prices vary from €30- 250 per sqm depending on the position, also in relation to the main roads. The plot land asking prices vary from €70 - 1,400 per sqm depending on the position, also in relation to the main roads and to the city. The highest prices are noticed in the proximity coastline and on the side of national highways.As a result of the lack of urban studies and indifference to the illegal constructions, there has been an artificial increase of the land prices in the tourist areas of the country. With the performing and approval of urban plans in Albania, significant differences in terms of land value within these areas are expected.

How much is the Reservation/Agency fee?

QA

What are the payment terms?Generally you would pay between 20%-30% of your total purchase after the pre-contracts have been signed by you and your POA. The percentage varies depending on how far the construction is towards completion. Then we try to put other payments in relation with the stages of construction. Therefore payments might follow with another 30% on completion of concrete shell of the residence, 15%-20% on completion of installations, 10%-20% on delivery of the apartment and 10% with registration and receiving of the title deed.


QA

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The final payment is often not until four-five months after completion. Clients are allowed to furnish and live in the properties before they receive the deeds.

Since Albania Estate started selling Albanian property to internationals 5 years ago , it has been possible to source the best independe nt lawyers and recommend them to our clients.

There is no obligation for buyers to use our recommended lawyers and our advice would always be to consider some sort of consultation with an international lawyer in your own country in an advisory capacity.

You would expec t to pay from 600-2000 Euro for a quality English speaking lawyer in Albania. Price is determined based on how many units you buy. Further to our initial due diligence with a lawyer, in checking paperwork etc, your lawyer would be your contact through the initial contract procedure up until your first payment.

They would also be on hand to remind you when further payments are due and to push for security of your title deeds after completion of the project. At Albania Estate we will be using our own in house lawyer to verify papers before passing onto the lawyers for final checking and stamps.

QA

How can I instruct a lawyer?

Appoint a lawyer

Await POA certificate to be sent via email

Sign certificate in front of notary in your own country and have the

POA apostilled.

Return POA certificate to your lawyer in Albania.

Receive by email draft of undertaking-contract.

Liaise with lawyer for any issues or clarifications & agree on the draft.

Await pre-contract signed by lawyer and developer.

Transfer first installment by bank transfer, with details supplied by

Albania Estate. Other installments will follow during

the construction period.

What is the process after the initial reservation fee is paid?


QA

QA

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Approx how much are communal charges?

Expect to pay around 150–200 Euros a year for maintenance in the residenc es without swimming pool. Then water, electricity, is paid based on consumption and an average monthly bill could go approx 50 Euro, or 600 Euro per year if the apartment is used during 12 months.

Parking is a problem in Tirana and the coastal towns. Our advice at Albania Estate would be to purchase if you can afford it. It will be money well spent as an investment and will be an important commodity when selling or renting. Prices will vary from 12,000 to 25,000 Euro in capital city Tirana; 10,000- 15,000 Euro in Durres and Vlora; and 7,000- 10,000 Euro in Saranda.

Is there a need for car parking?

QA

After residence is completed expect to pay 300-350 Euro for the contracts with Electricity and Water companies.

On registration of apartment you will sign the Sale & Purchase Contract, and at same time you will have to pay 4-5 Euro per 1m2 for the Registration Tax.

Should you decide to sell the property, there is a Selling Tax (similar to capital gains tax) of 10% payable in Albania, on the difference between purchase and sale. There is also a flat income tax of 10% on the rental income, should you rent your property out.

Starting on January 2008 corporate tax was also reduced to a flat 10%, as is income tax.

With all this in mind, your only extra fees in purchase will be real-estate ag ents and lawyers. For total tax and financial advice, Albania Estate can recommend certified accoun tants to help you through any questions you may have in this respect.

What other costs do I need to be aware of?

Are there any guarantees from the developers?Albania Estate is very particular in the developments that come onto the market through themselves. All the paperwork is checked with our lawyer and solicitor to be sure of legality and title. It is nearly always the case that that developers will look to raise finance from the financial institutions, which will themselves cross check the credibility and finance of the developer. This package gives the comfort of security to all our investors at Albania Estate.


In the past few years, Albania has made clear progress in a number of areas necessary to allow the smooth running of real estate finance and real estate transac tions.

The lending environment is greatly improved. Although limited by numerous factors discussed above, mortgage lending even in the actual context is underway, as well as

“consumer” lending for housing purposes .

Overall, there is a growing awareness among the government of the impor-tance of the real esta te sec tor and the need to push reforms to solidify and improve its legal and administrative framework.

Foreign investors have just started to chase the emerging Albanian real esta te market in fear of missing out on the last European newcomer. Opening the country to international investors is desirable for increasing transparency and building up expertise. Foreign capital is also important as additional source of finance.

An encourag ing factor in favor of rising standards in the Albanian markets over the next years is the anticipation of continuing GDP and consumer expenditure growth compared with the EU recession. The economic knock-on effect will benefit real estate growth, investment opportunities and development prospects.

The growth of the economy, the price stability with a low inflation rate of 2.5%, the favorable tax system, the increase in urbanization, the demog raphics and the Diaspora are determinant factors that are likely to deliver a different profile of performance to that in Western markets.

NATO membership, bright prospec ts for EU membership, a better political climate, the developing economy and moving real esta te prices – Albania has it all. Enthusiasm from local investors has been substantial and interest from inter-national investors is just emerging. The real estate market in Albania currently offers specific opportunities and looks set to do so for the foreseeable futur e.

Immaculate beach in Porto Palermo– Vlora

Conclusion

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For further details on how we can supply you with more information on outstanding investment opportunities, please contact us:

Tirana Office - Headquarters

Ilir Dardha - Albania Director Cell: +355 6720 84393 [email protected]

USA and Canada

Cape of Rodon – Durres

Sam Dardha - Executive Director Cell: +00 1 414 852 5513Email: [email protected]

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albania buyers guide

Documents

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albanialocation of albania

century albania

ottoman empire

byzantine empire

foreign loans

after1912tillthe end

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