The situation appears more critical in Tirana where no construction permits have been issued since April 2009
TIRANA, July 19 – The construction industry, once the main driver of the Albanian economy, says it is experiencing its worst situation in the past 20 years. Maks Muci, the head of the Constructors Association says the situation is a result of global crisis effects but also lack of construction permits, lack of liquidity and failure to get paid for public works which have all influenced the severe situation in the construction sector.
The situation appears more critical in Tirana, where no construction permits have been issued since April 2009, Muci told reporters.
A recent World Bank report ranked Tirana the worst city in the region for dealing with construction permits as no permit has been issued since 2009.
“As of January 2011, no construction permit had been issued here since 2009, mainly because rivaling political parties represented in the council make consensus decision making unattainable,” said the report which covered 22 cities from Albania, Bosnia and Herzegovina, Kosovo, FYR Macedonia, Moldova, Montenegro, and Serbia.
Latest INSTAT data show the construction sector which had been in crisis since 2008 returned to growth increasing by 4.8 percent compared to the first quarter of 2010 and 11.8 percent compared to the final quarter of 2010. However, confidence in the construction industry registered an 11.2 percent drop in the second quarter of this year.
Reports show citizens are becoming more reluctant to buy new apartments because of falling revenues and especially a sharp decrease in immigrant remittances. This is confirmed even by data of the Albanian Association of Constructors which says some 4,000 apartments remain unsold because of falling purchasing power.
Apartments prices in Tirana vary from 700 to 2500 euros/m2 in downtown Tirana compared to 400-650 euros/m2 in uptown areas of new ring road and Fresku.
The highest prices are reported in the downtown area known as Bllok, where prices go up to 2,500 euros/m2.
