In 2018, the Albanian government took a significant step towards the real estate taxation system, establishing a new methodology for determining the taxable value of this property, especially for the immovable property category, or otherwise known as ‘buildings’.
This change, approved based on the “Methodology for determining the taxable value of real estate ‘buildings’, and the tax base for specific categories”, aims to incorporate market property values with the corresponding taxes as a way to increase transparency and accuracy in the property taxation process. One of the key changes introduced by this decision was the increase in apartment reference prices upon which the property tax assessment is based.
Recently, changes related to this decision have been published in the Official Gazette, highlighting the increase in reference prices per square meter for dwellings. According to these changes, the average increase in reference prices for the 32 cadastral zones of Tirana is estimated at approximately 29,600 lekë per square meter.
The changes in question indicate a significant price increase in the capital region; in cadastral zone 1/1, the price has reached 102,800 lekë per square meter, and for cadastral zone 5/3, which includes the area of Komuna e Parisit, the Botanical Garden, and the Artificial Lake, the price has seen an increase of 57,800 lekë per square meter and now totals 164,800 lekë per square meter.
For other cadastral zones, including the former Blloku area, the reference changes have brought significant increases, with prices reaching up to 228,400 lekë per square meter. Also, the Medrese area, known for its economic activity, has experienced an increase in the reference price and now totals 156,700 lekë per square meter.
The effects of the increase in reference prices are evident in the property taxation paid by citizens and businesses. The building tax for families has increased to 0.05% of the apartment’s value, while for businesses, the building tax has increased to 0.15%. This tax increase aims to better reflect the real values of immovable properties in the market.
In conclusion, reference prices for immovable properties in Albania are a complex issue that affects not only the living standards of citizens but also the approach of investors and professionals to establish their businesses in our country. It is important to continue monitoring the effects of this decision and to take the necessary steps to improve procedures and reduce uncertainties that may be encountered during this process.
Below you will find the complete table on reference price changes for Tirana.
