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Ekonomia

What is happening to the construction sector? Demand for purchases decreases, the tax on real estate agents artificially increased prices

What is happening to the construction sector? Demand for purchases decreases,

The construction sector showed pessimism in March. While they expect construction activity, employment and prices to slow down, the effect is also felt in the real estate market where experts indicate that the pace continues to remain the same compared to the same period last year, but with lower demand.

"The only thing for the moment according to reports and our interpretation that we see as a problematic element is the lack of new squares mainly within the big ring of Tirana. All the focus of the construction is going towards the peripheral areas, this is an element that makes us have an accurate report about the prices, which means all the area within the big ring of Tirana is being focused and homogenized in one price certain that has to do with the construction phases, meanwhile, if buyers are looking for something more economical and more flexible in purchasing, they should be oriented towards the suburbs". 

During this year, a new method for the taxation of real estate was put into effect at the rate of 15%, while for old buildings the reference price is reduced by 1% for each year of age. The imposition of the tax according to agents has led to an artificial inflation of housing prices in the market

"In all the applications we made, they were reflected very well, the notaries were cooperative and there were no problems. But, what has arisen as a problem is that the owners have the tendency that even though their property may have 20 years of construction, they cannot be called new buildings, they still have the tendency to be on the market at a price that the newly built buildings have , that don't compare to the build quality or comfort they offer."

The real estate sector has brought the biggest contribution to economic growth over the past year, while foreign direct investments also hold the main weight, making the sector vital for the country's Gross Domestic Product.

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