After a long break, the housing market is trying to break out of stagnation
The Ober-Haus Lithuanian apartment price index (OHBI), which follows changes in apartment sale prices in the five biggest Lithuanian cities (Vilnius, Kaunas, Klaipėda, Šiauliai and Panevėžys) increased by 0.1% in August 2024. The annual apartment price growth in the biggest cities of Lithuania was 3.0% (a 3.2% increase was recorded in July 2024).
In August 2024 apartment prices Vilnius, and Šiauliai increased by 0.2% and 0.6% respectively, with the average price per square reaching EUR 2,620 (+6 EUR/sqm) and EUR 1,137(+6 EUR/sqm). In the same month, apartment prices in Kaunas and Klaipėda decreased by 0.1% and the average price per square meter dropped to EUR 1,789 (-1 EUR/sqm) and EUR 1,702 (-2 EUR/sqm) respectively. Apartment prices in Panevėžys did not change during the month and the average price per square meter remained at EUR 1,109.
In the past 12 months, the prices of apartments increased in all the biggest cities in the country: 1.9% in Vilnius, 3.7% in Kaunas, 5.7% in Klaipėda, 3.4% in Šiauliai and 3.3% in Panevėžys.
“The Lithuanian housing market is already trying to recover from the stagnation that has gripped it, which lasted basically until mid-2024. August is the second month in a row when the number of apartments and houses sold in the country is higher than in the same period a year ago. According to the data of the State Enterprise Centre of Registers, in July this year, the number of purchases of dwellings (flats and houses) was 10.7% higher, and in August it was 6.3% higher than in the same month a year ago. These data show that the housing market has already reached its lowest point of activity and homebuyers are slowly returning to the market.
However, the positive changes in housing activity recorded are hardly visible in practice on the market, as the overall volume of home purchases remains at a relatively low point and the negotiating positions of home sellers have not improved substantially. This is confirmed by the prices of old and new-build flats in the last few months, which have remained stable in the major cities. Buyers currently still lack confidence both in their financial capacity and in the prospects of the housing market and are taking their purchasing decisions slowly. It is likely that buyers will return to the market slowly and this will require not only a further steady decline in interest rates, but also more positive news in the country’s economy and real estate market,” says Raimondas Reginis, Ober-Haus Research Manager for the Baltics.
Full review (PDF): Lithuanian Apartment Price Index, August 2024
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