Housing rent in Tirana takes up 93% of the average salary

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Tirana ranked second in Europe in terms of the ratio between rental housing costs and incomes. In May 2026, the average monthly rent in the Albanian capital reached €710, while the average net salary stood at €760. Thus, housing costs accounted for about 93% of income, VoxNews reports, citing a Tradingpedia study.

Tirana ranked behind only Lisbon

Tradingpedia compared average rents and net incomes in 127 European cities. Tirana ranked second by the share of salary required to pay for housing. The situation was worse only in Lisbon, where the average monthly rent reached €1,331, equivalent to 99% of the average net income.

Kyiv ranked third, with rental housing costs accounting for 88% of the average salary. In May, the average rent in the Ukrainian capital stood at €558 per month, while the average net income was €637.

At the same time, rents in Tirana are lower in nominal terms than in many other European cities. For example, the average monthly rent in Porto was €1,108, while in Malaga it reached €1,195. However, relatively low household incomes make housing in the Albanian capital one of the least affordable in Europe.

A similar problem can be seen in other cities in the region. In Pristina, an apartment could be rented for just €326 per month, but with an average net income of €583, housing costs still accounted for about 56% of salary. In Constanța, Romania, average rent reached €531 per month, equivalent to around 64% of average net income.

Apartment owners are shifting to long-term rentals

The structure of Albania’s short-term rental market is changing. Apartment owners who list properties on Airbnb and Booking are not required to register a separate NIPT tax identification number, but they must declare their income through the annual DIVA return and pay a 15% tax.

The formalization of this segment and new tax requirements are gradually affecting the behavior of property owners. According to real estate market participants, owners of one or two apartments are increasingly moving away from daily rentals in favor of long-term leases. The reasons include higher operating costs, taxation and the need for more intensive property management.

As a result, the short-term rental segment is becoming increasingly concentrated among professional operators and real estate agencies that manage larger portfolios and handle marketing, property maintenance and booking management on Airbnb and other digital platforms.

According to real estate agents, the market is gradually splitting into two segments. Owners of a single property tend to choose long-term leases for greater income stability, while short-term rentals are increasingly being managed by specialized companies.

Airbnb bookings generated around €40 million in 2024

Albania’s Tax Administration reported that in 2024 more than 8,472 individuals and legal entities in the country were registered as earning income from renting out accommodation through Airbnb. The total value of bookings during the period reached around 3.8 billion lek, or approximately €40 million. Platform commissions amounted to about 167.5 million lek.

Tax authorities have repeatedly stated that they have access to data on these transactions and have urged recipients of short-term rental income to report it in the annual DIVA 2025 individual income tax declaration in accordance with current legislation. Failure to declare income may result in tax audits and penalties. At the same time, some owners renting accommodation to tourists still operate informally, which has prompted the authorities to tighten oversight.

One of the methods used to identify property owners is data on the commissions they pay to the Booking platform. A pilot project has also been developed to systematize information on owners renting out properties through Booking and Airbnb. The information obtained is expected to be cross-checked against annual DIVA tax declarations. This will help identify undeclared rental income and apply the statutory 15% tax.

Property tax increase in Albania

Property owners may face an additional burden due to a proposed reform of the property tax system in Albania. The Ministry of Finance proposes increasing the tax rate for residential properties from the current 0.05% of their value to a range of 0.1–0.2%. The final rate would be determined by municipal councils.

At the same time, a tax-free threshold is proposed for primary residences. In Tirana, it could be raised to 8.4 million lek, meaning that tax would be charged only on the portion of a property’s value exceeding this amount. No such deduction is envisaged for second homes, increasing the tax burden on owners of multiple properties.

The reform continues the policy outlined in Albania’s 2024–2027 tax program. The authorities aim to increase property tax revenues, which currently amount to around 0.3% of GDP, compared with an average of approximately 0.8% across the region.

What this means for investors

International Investment analysts note that Tirana’s property market remains attractive to investors due to high rental rates and steady demand, but the potential for further rent growth appears limited. If housing already consumes around 93% of the average net salary, further increases will increasingly be constrained by the purchasing power of local tenants.

At the same time, the market is becoming more regulated. Tighter oversight of income earned through Airbnb and Booking, the 15% tax and the proposed property tax increase are raising owners’ costs. This could reduce net returns from short-term rentals and encourage some landlords to move toward long-term leases, where returns may be lower but more stable and require less day-to-day management.

In the longer term, the market may become more transparent and professional, while short-term rentals could become increasingly concentrated among larger operators and agencies. For investors, this means that the key factors will be not only rental rates and purchase prices, but also taxes, management costs, rental strategy and the actual purchasing power of tenants.