Riga in some years may catch Tallinn, Vilnius by number of new apartments - Bonava Latvija

  • 2019-11-06
  • LETA/TBT Staff

RIGA - At present Riga lags behind Tallinn and Vilnius by the number of new apartments, but in the coming dive to ten years the situation could improve, said Mareks Klavins, a board chairman of real estate developer Bonava Latvija, in an interview with LETA.

Accoridng to Ober-Haus data, in 2018, 4,355 new apartments were built in Lithuanian capital Vilnius, 3,100 in Estonian capital Tallinn and 2,411 in Riga. In 2017-2019, 7.9 new apartments were built per 1,000 residents in Vilnius, 7.1 apartments in Tallinn, and just 3.1 new apartments in Riga.

Klavins said that before the previous financial crisis Latvia had not been so considerate in financing construction as its neighbors. "We needed longer time for banks to deal with their portfolios, get rid of objects that they did not need to finance. During the crisis, many people moved the the grey zone, thus, they have no access to loans," said Klavins.

He also said that there is a pressure on banks in relation to money laundering, shadow economy, thus, they have to conduct many procedures to ensure that all requirements are met.

"I think the situation will improve in the coming five to ten years. We see a rise of the average wage and paid taxes. Banks are ready to finance customers again," said Klavins.

Speaking about real estate developers and the situation that there are no strong local developers, Klavins said that he does not see any problems there - globalization is a trend, and international companies are entering the market, while the construction sector is not an exception in this.