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Buy a house or rent it?

2025-11-02 08:15:27, Ekonomi CNA

The price-to-rent ratio is used all over the world to show whether it's worth buying a home or renting. It measures the value of a home compared to the income you can get from it.

According to expert estimates, renting a house is profitable if this ratio is greater than 20, and buying it if this rate is less than 15.

If the rate is between 15 and 20, then it makes more sense to buy, in case the buyer intends to live in the home for a long time.

The price-to-rent ratio is the average cost of ownership divided by the rental income received (if purchased to rent) or the estimated rent that would be paid if rented (if purchased to live in).

Lower values ??suggest that it is better to buy than to rent, and higher values ??suggest that it is better to rent than to buy.

According to the data provided by "Numbeo" until mid-2025 for Tirana, this ratio is 19.7 for the central areas, and 16.2 for the areas outside the center. So for the areas outside the center, the ratio is within the limit of buying a house.

Stela Dhami, real estate market expert and representative of Colliers International Albania, says that the ratio between the sale price of an apartment and the income coming from renting it out has become increasingly skewed in Albania.

“Today, in Tirana, it takes an average of 19 years to repay the investment of an apartment through rental income, while the average in other European countries is around 13 years, and ideally this period should be 10–12 years,” says Ms. Dhami.

According to her, this disproportion comes because sales prices have increased significantly in nominal value, while rents have not followed the same growth rate.

This makes the return on investment slower and puts the Albanian market on a trajectory similar to those of some Western economies, where many people are unable to buy and end up living permanently in rentals.

Office and shop rentals

In addition to the price of long-term residential rentals, office rents also continued to remain high during 2025.

According to data published by "Colliers International Albania", average office rental prices in the center of Tirana continued to remain at 30 euros per square meter for the second half of 2025, equaling those of Barcelona and Prague, two consolidated markets in Europe.

With this price, Tirana ranks not only among the most expensive cities in the region, but also higher than some European Union cities.

In Tirana, rental prices exceeded European capitals, such as: Portugal, which records values ??of 29 euros, or Budapest with prices of 25.5 euros, and Bucharest with average prices of 20 euros per square meter per month.

Office rental prices are even higher than in regional capitals. In central Belgrade, prices reached 18 euros per square meter in the first half of 2025.

In Zagreb, prices are 17.5 and in Sofia 16 euros per square meter per month.

Tirana is also among the most expensive cities for rental prices in secondary areas. With an average of 19 euros per square meter per month, the Albanian capital surpasses several cities in the region such as Belgrade (15 euros), Zagreb (13 euros) and Sofia (11 euros).

On the ground, according to data obtained from real estate agencies, office rental prices vary significantly depending on the location and quality of the building.

In well-known tower buildings or business centers, such as "Arena Center", "Alban Tower", "Downtown One", "Rainbow Center" (formerly Blloku), "MET Building" and "Lion Park", office space is offered for rent at prices ranging from 22 to 30 euros per month per square meter, reflecting high construction standards, but also favorable locations for businesses.

On the other hand, prices for offices in different areas of Tirana are lower and more affordable, but with noticeable variations within the area itself.

In Unaza e Re, rents range from 6 to 8 euros per month per square meter, making it one of the most economical areas for offices.

In the former bus park, "21 Dhjetori", prices are higher, ranging from 10 to 13 euros per month per square meter.

The area of ??Rruga e Kavaja in the Center presents a range of 15 to 23 euros per month per square meter, while the former Blloku and “Willson” Square are among the most expensive in the non-tower areas, with prices ranging from 18 to 25 euros per month per square meter.

In areas such as the former train station, Bulevardi i Ri and Tregu Medreseja in the 5 Maji area, office prices start from 8 to 10-12 euros per square meter per month.

Store rents have also increased in recent years. In 2020, according to data from real estate agencies, the maximum prices for store premises on main streets were 40 euros per square meter, while the maximum rent for stores in shopping malls reached 52 euros per square meter.

For 2024, according to Colliers Albania, maximum rents have reached 70 euros per square meter per month for shopping centers and 55 euros per square meter per month for main retail streets. The increase is 38%./Monitor.al