Who shall own property in Albania?
Personal ownership is the most common case for a foreigner purchasing a property in Albania. There is no
need of creating a local company like in Montenegro, ,...

Are there restrictions to foreign ownership?
The restrictions pertain to agricultural lands only.

Do I need to create a company in Albania?
If you intent to purchase a land or to have a commercial activity. The fees for creating a company are
around 100 Euro and in theory it can be done in a day. Then local & licensee taxes need to be paid
(+-1’500€/year).

Is Co-Ownership allowed in Albania?
YES. A co-ownership is an arrangement whereby two or more persons buy a property together and wish to
provide for leaving their share (when they die) to someone other than the other co-owners. In legal terms
this is called a ‘Tenancy in Common’. If you are buying with a member of your family or a friend, you may
wish to put in place a co-ownership agreement which provides what will happen to your share in the event
of your death, but also important issues such as what each party is contributing to the purchase and how
expenses, income and capital gains are to be shared. You can also include agreement as to a minimum
period that you will hold the property, and what will happen if one of the co-owners wants to sell his share.

How can I purchase lands from the Albanian state?
This has been the source of many issues in the past. We cannot recommend clients to purchase or lease
lands to/from the state except in specific cases.

Do local bank offer mortgage loans?
YES non-resident mortgage financing is available. The main local banks are controlled by large European
banks: Credit Agricole, Societe Generale, Banca San Paolo IMI, Raiffeisen Bank, Piraeus Group, National bank
of Greece, Alfa Bank, …. These banks have already approved our real estate properties and are interested to
offer competitive mortgage loans with terms from 1 to 15 years. We also signed the first agreement
with a major bank and a construction company where the bank offered 100% mortgages loan to local
buyers. For foreigners specific favourable terms are applicable and some banks do not request client to visit
Albania.

Do I need an attorney to buy a property in Albania?
Attorneys can provide valuable services to purchasers of Albania real estate, Services as document review,
translation, drafting of contracts, tax tips, PoA, etc. We are controlling each case before introducing
clients. Furthermore we have two internal solicitors in charge of advising clients. In case you ask for
independent attorney assistance we have negotiated with three of the largest law firms in Tirana a
special all inclusive fees for property purchased <550€.

Does the Public Notary verifying the clear title of the property?
The public notary is liable for the verification of the original title of the property which is a document issued
by ZRPP (State office of registration of property) called differently Mortgage Bureau. By law, the public
notary before preparing the sell contract which is the final act between the seller and the buyer need to
check the full history of the property.

What is the cost of the Public Notary?
The fees depend of the service, property size and total price. For a transaction of €100’000 it can
approximate €200! (In Morocco or France for example you need to budget an extra 10% in addition to the
purchase price to cover notary and Property Registration fees!).
Is there an Albanian official statuary Real estate property registration office?
YES this office called ZRPP (State office of registration of property) is properly run and manages a clear and
fully acknowledged ownership history for each lot. Furthermore digitalization financed by World Bank is
underway.

What are the other costs linked to a purchase?
There is no Transfer Tax to be paid by the buyer (in Croatia 5%, in Montenegro and in Bulgaria 2% of the
Purchase Price! In Turkey 1.5% as Buyers Tax plus electricity and water connection!). There are some
expenses to be paid to ZRPP, but in all the cases not more than 300 Euros.

Do you offer Property management services?
YES. For overseas owners who are concerned about owning property in Albania, we offer a worry-free
ownership program and provide property maintenance services. Please ask for our Property Maintenance
Services as far as now we are the only one providing this service in Albania.

What is the buying process?
The buying process in Albania follows this format:

• Once the reservation contract has been signed, which will secure your interest in the property; there is
usually a period of 4 weeks in which to carry out checks before the investor signs the main 'preliminary'
contract. The preliminary contract is signed by all parties in which they effectively promise to enter into a
final contract to buy and sell the property. After all the necessary details are provided, the contract will be
drawn up by the developer’s Notary and will set out timescales, payment terms, prices and the terms and
conditions agreed.
• When the preliminary contract is signed the investor will usually pay a deposit of 10% of the price on a
second-hand property or a down payment of 30% to 50% on “off-plan” property. However it is subject to
the particular developer’s requirements with a certain level of flexibility. The remaining monies are then due
on construction completion and payable in stage payments.
• Once the skeleton of the building has been completed you are able to fund the remaining amount via
mortgage. At completion of the roof level the bank will take over the payments.
• The Notary plays a major part in the process of buying and selling real estate. The notary is a public officer
who is there to ensure that the transaction goes through in a proper legal manner. Once the property has
been finished the final contract/Notary Deed/ is signed transferring the right of ownership to you. At this
point it can be put on the public record which will show the official transfer of title to the buyer.
• Once this has occurred, the buyer will transfer the remainder of the funds and obtain the title deeds in his
name. At this point the property is legally completed and the buyer becomes the owner!
If you are taking a mortgage loan the process usually takes a week or two. For off-plan properties typically
banks will finance up to 70% of the asking price allowing the investor to purchase by putting in only 30% of
their own money. The loan guarantees will be first the collateral complete by the developer to the bank to
secure the process and then the property mortgage.

Do I have to pay state or local taxes on my property?
NO there is no state tax on real estate and local taxes in Tirana are +-7€/m2/year. For companies, the
government approved the flat tax of 10% starting 1st of January 2008. As such, Albania is one of the
countries with the lowest fiscal burden both in the region and the wider area.

Do I have to pay VAT on land, apartment and/or any property purchase?
NO. The sale of buildings and land is not subject to VAT! (20% in most of the countries).

Do I have to pay taxes if I don’t develop my property?
NO. This allows long term Buy and Hold strategy and support the making of a land portfolio.

Do I have to pay a capital gain tax on resale of my property?
There is a capital gain tax of 10% for individual and companies (instead of Bulgaria 17.8%, Spain 18% and
20% in Turkey or Poland)! Albania has signed limited double taxation treaty with several countries including
France, Hungary, Russia, Switzerland and others.

Do I have to pay a tax on rent?
A tax of 10% is due on the amount of the rent (25% in Hungary and Spain!).

Do I have to pay wealth tax?
NO. There is no wealth tax in Albania (France≤2%, Germany≤0.5%, Greece≤0.8%; Spain≤2.5% every year!).

Can capital and profits be repatriated without difficulty by a non resident?
There is no withholding tax in Albania (10% in the US). Capital and profits can be repatriated once you have
paid the legally due taxes.

What is the level of inheritance/gift taxes in Albania?
There is NO inheritance tax and gift tax is 3%! In case of personal ownership it is desirable to make a will in
respect to your Albanian property as soon as you become the owner.

What is the cost of insuring a property in Albania?
It cost 100 to 250€/year for insuring a 2 bedroom apartment depending of the benefits.

What is happening in case of default of the builder?
Our sources developments where the builder raises finance from a bank or guarantee via the bank the
mortgage loan of the prospective buyers. Nonetheless the bank requests a performance bond from the
builder to guarantee that in the event of the developer default, funds are available to finish the
construction. Furthermore the quality and financial standing of the builders is always thoroughly checked.
All companies that we work with are members of, and regulated by, the Albanian Chamber of Builders.
These companies are medium to large in size with a good track record of providing quality products that are
delivered in realistic timescales.

Yield
Foreign investors are coming into the market for residential notably with “popular” apartments that can be
rent to locals in such case yield can be >5% net. On commercial we can find opportunities with higher yield
but this is mostly a market for locals up to now.

Rate of Return
Most investors now are concentrating on the Off-plan market as the development time is fast thanks to the
Albanian climate and legislation. Imagine an Off-plan property costing 50’000€ you only put up a deposit of
15’000€ (30%) and then will have to pay the remaining in 12 months. Let consider the market is up by 10%
after 12 months then your property worth 55’000€. You return would then be €5’000/€15’000, or 33%! It is
a basic calculation as you can also get a mortgage financing with interest only for 3 years, rent your
apartment and taken account of taxes, fees and other expenses.

What should an apartment/ villas cost to run?
Costs will depend on how large it is, how many staff are employed and most importantly, the lifestyle of the
owner. Despite the many variables, it is possible to benchmark costs according to the size of house and the
staffing. For a villa of around 200 sqm, with three or four bedrooms, the annual running costs to be under
€1’500 a year. This is inclusive of general maintenance and utilities. It assumes the house is new. For
apartment the cost is 2 to 3€/m2/year in Tirana.

For staffing, one full time housekeeper/cook will be <300$/month, a gardener <200$/month and a cleaning
lady 50€/month.