Housing Prices Continue to Fall
Albanian Daily News
Published October 24, 2017
The housing price index at the national level was 7% lower in the third quarter compared to the previous quarter, the Bank of Albania said in its survey on real estate market released Monday.
The situation in the real estate market is assessed through the field survey of a sample consisting in 230 real estate agents and construction firms, representing around 75-80% of the sample of these entities by size of activity. The net balance of responses of 11.6% for the question How do you assess the market situation compared with the previous period shows a higher number of agents providing negative response (worse) than the positive response (better), Bank said.
This value is somewhat more negative compared with 2016 H2 (-8.6%), reflecting a slight worsening of agents assessment for the market situation. As expected, the same indicator assessed only for the entities reporting sales during the period, shows a considerable more positive assessment; the net balance of responses on the overall situation by the entities reporting sales is around + 22%.
For Tirana, the index fell slightly compared with the base period by 2.2%, and by 16.7% compared with the previous period. In the coastal areas, the agents reported lower average prices than those of the base period, but around 7% higher than those of 2016 H2.
Agents report almost the same number of houses recorded in their books; the net balance between those reporting increase and those reporting decrease recorded in their books stands at slightly positive values. Related to commercial properties, the net balance is -3.8%, from the positive value 2.6% in the previous period.
The number of unsold properties, both for residential and commercial buildings was down; the net balance was positive, showing less unsold properties, for the second successive period, since the start of the survey, though at more moderate values compared with 2016 H2.
The average time of sale for real estate, at the national level, is 10 months, or around 3.7 months shorter compared with 2016 H2. For Tirana, the respondent entities reported an average time of sale of 9.5 months, considerably lower compared to 13.8 months in 2016 H2. For the coastal area, the average sale time increased, from 8.4 months to 11.7 months, while for the other areas, the entities reported a considerable fall in the same sale time with the previous period, from 15 months to 9.7 months. According to agents, around 72%, of properties for both, residential and commercial buildings sold by them, are purchased with loans. This figure is slightly up compared with 68% in the previous period. The loan-to-value ratio accounts for around 64% of the house value, higher from 53% in the previous period.