Albanians’ spending on property abroad is growing rapidly year after year, indicating that part of the profits and savings generated within the country are transferred abroad, buying mainly housing.
In the section of national accounts for Gross National Product (GDP), INSTAT reported that, in 2019, the expenditures of Albanians who are resident in Albania for properties abroad reached ALL 69 billion or (566 million euros). Property purchases abroad marked a record level in 2019 with an annual increase of over 44 percent.
Expenditures on property abroad increased steadily, especially after 2011. They were low until 2007, but after the 2008 crisis, an unusual increase was seen (see the attached chart).
From ALL 7 billion in property expenditures abroad in 2007, a year later, in 2008 this value increased more than fourfold, to ALL 32 billion.
During the period 2008-2013, the expenditures of Albanians residing in Albania for properties abroad were 1.6 billion euros. In 2013 there was a decline in the indicator, where it is seen that only 11 billion ALL were spent, or three times less than in 2012.
Property purchases abroad started again at a fast pace after 2014. According to INSTAT data, from 2014 to 2019, Albanians’ expenditures on properties abroad reached 2 billion euros.
The record is held by 2019, where the value of the indicator reached 69.7 billion ALL, or 431 million euros.
From 1996 to 2019, expenditures on property abroad amounted to ALL 497 billion or about EUR 4 billion.
In the absence of financial instruments, Albanians are increasingly seeing real estate, especially housing, as an investment vehicle. This trend is being seen from a large momentum of constructions within the country.
New constructions, especially in Tirana, are luxurious and target buyers with very high incomes. This income used to buy property is often not justified by official sources. The construction sector was one of the main typologies for money laundering by Organized Crime Organizations for 2020, reported the Directorate for the Prevention of Money Laundering./oranews