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Wages increase construction costs in the fourth quarter

Politiko 2026-03-04 16:34:22

Construction costs continue to rise, albeit at a slower pace, while wages remain a major factor influencing this trend. The labor shortage is forcing employers to raise wages or hire workers from abroad, with Egypt being the most preferred.

According to INSTAT, the Construction Expenditure Index in the fourth quarter of 2025 reached 114.1 compared to the fourth quarter of 2021 as the base period. The annual change in the Construction Expenditure Index in the fourth quarter of 2025 is 1.2%, the same as the annual change recorded in the same quarter of the previous year.

Annual changes of the main groups: Compared to the same quarter of the previous year, the largest price increase is observed in the group "Salary expenses" with 6.0%, followed by the group "Machine expenses" and "Other costs" with 1.8% each, respectively, and "Transport expenses" with 1.6%. On the other hand, the group "Material expenses" marked a decrease of 0.9%.

Within the "Material Expenditures" group, the index of the "Construction Materials" subgroup marked a decrease of 1.1%, followed by the "Hydro-sanitary and ventilation materials" subgroup by 0.6% and the "Electrical and communication materials" subgroup by 0.1%.

Quarterly changes in the main groups: The Construction Cost Index increased by 0.1%, compared to the third quarter of 2025. The largest price increase is observed in the "Salary Expenses" group with 1.4%, followed by the "Machine Expenses" and "Other Costs" groups with 0.3% each and "Transportation Expenses" with 0.1%.

On the other hand, the group "Material expenses" has decreased by 0.5%. Within this group, the subgroup "Construction materials" decreased by 0.6%, followed by the subgroup "Hydro-sanitary and ventilation materials" by 0.5% and the subgroup "Electrical and communication materials" by 0.3%.

Apartment prices, meanwhile, have been steadily increasing in recent years. Measurement data from several indices simultaneously show that in Tirana, the increase in apartment prices has accelerated.

In the first 6 months of 2025, the Bank of Albania's Fischer Index data showed that housing prices in the country increased by 14.6% compared to the previous six months, and by 41.7% compared to 2024. As a result, purchasing a home is becoming increasingly unaffordable for middle- and low-income families. While rents exceed the affordability limits recommended by international standards.

By June 2025, according to the Keydata index, the average price per square meter of an apartment reached 1,830 euros. The average price was calculated based on data on the prices of existing apartments, i.e. for buildings built 5, 10 or 15 years ago.

Compared to 2005, the earliest year when the calculation began, prices are 2.8 times higher. The average price of apartments in 20 years has almost tripled compared to 2005. Monitor