Flat Prices Not To Drop Soon

TIRANA, June 7؅ven though the global economic crisis has shattered the real estate market all over the world with prices tumbling, Albanians aspiring for a new apartment in the city or a beach house on the coast, are not likely to enjoy price cuts in their home market.
Various real estate companies say that both demand and supply have dropped sharply. Prices have remained at the same level as a year ago, which makes potential buyers reluctant, and builders/developers refuse to sell their product any cheaper.
It is two months now since the construction sector has declared itself in crisis and called for the government’s help. However, such alarming notes have not been reflected in the market, even though more than 4000 apartments remain unsold in the area of Tirana and Durres.
Yet, builders/developers refuse to sell at prices indicated by the market situation.
“It can be said with certainty that who wants to sell, can do so by cutting their prices by 10% or more. The rest, the ones keeping prices high, are simply not interested to sell,” explained a real estate agent for an Albanian newspaper.
Real estate agencies do not predict any change in the market behavior during the next months, either. Summer, when more holiday homes or investment properties over personal residences are being bought, has been the busiest season in real estate sales over the past few years. Not this time around though. Albanian immigrants, themselves hit hard by the crisis, will have a hard time holidaying, let alone spending big on new homes. Remittances from immigrants dropped by more than 13% in 2008, and the trend will likely continue in 2009 and beyond.
Real estate prices might drop by 10% in the suburban areas around Tirana and Durres, say the agencies, but builders/developers will hold their ground when it comes to the main urban areas and the coastline, which makes for the lion’s share of the market by far.