TIRANA, July 31 – New real estate loans in Albania totaled 36.2 billion lek in the first half of 2025, marking a 32% annual increase, the Bank of Albania reported Thursday.
Real estate lending now accounts for roughly 27% of total loans to the economy. In June alone, banks disbursed 7.4 billion lek in new home loans, up nearly 60% year-on-year.
The surge is partly due to a rush of borrowing before new loan-to-value limits imposed by the central bank took effect on July 1. Under the new rules, banks may finance up to 85% of the purchase price for first homes in local currency and 75% for foreign currency loans. Stricter limits apply to second-home purchases.
Real estate loans are typically backed by property collateral – often the home being purchased – and growth has been particularly strong in coastal areas and Tirana. The volume of new euro-denominated home loans is also on the rise.
The debt-to-income ratio for lek-denominated mortgages is now capped at 40% for first homes and 35% for second homes, while for loans in foreign currency, the caps are 35% and 30%, respectively.
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