Housing market starts recovery

RIGA - House prices in Latvia increased 26.3 percent in the third quarter year-on-year, which is the fastest increase across all countries surveyed in British property company Knight Frank’s global house price index, reports news agency LETA. Before the third quarter, Latvia was last in the index for several quarters in a row, reporting the steepest house price falls during the global economic crisis.

According to the real estate company Ober-Haus’ index of apartment prices in the Baltic capitals, however, the average price for an apartment square meter in Riga rose 4.8 percent in November, year-on-year, while in Tallinn prices increased 12.7 percent in November.

The average transaction price in Tallinn in November was 942 euros per square meter. The average value of an apartment’s transaction in Tallinn decreased 5.2 percent in November after increasing 7.6 percent in October.
The number of transactions in November was 616, the highest level this year, showing that the market is on a recovery pace. In Riga the prices for apartments are still 60.9 percent lower in comparison with their peak reached in May 2007.
As the Ober-Haus report shows, November was an active month in the real estate market in Riga, both from the owners’ and buyers’ side.

Over the past 12 months, the prices of apartments in Vilnius decreased 0.7 percent, marking 40.1 percent off their December 2007 peak. In Vilnius, apartment prices increased 0.4 percent in November and the average price now is 1,189 euros per square meter. Prices for apartments have risen for the sixth consecutive month in the Lithuanian capital and the overall increase for this period is 2.9 percent.

In other main Lithuanian cities (Kaunas, Klaipeda, Panevezys and Siauliai), prices are still decreasing, with Ober-Haus recording monthly decreases in prices of 0.1 percent, 0.8 percent, 1.2 percent and 2.3 percent, respectively.