The recovery of a very strong-looking housing market may slow down

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 0.5% in March 2025. The annual apartment price growth in the biggest cities of Lithuania was 4.3% (a 4.1% increase was recorded in February 2025).

In March 2025 apartment prices in Vilnius, Kaunas, Šiauliai and Panevėžys increased by 0.4%, 1.3%, 0.4% and 0.2%, respectively, with the average price per square meter reaching EUR 2,680 (+10 EUR/sqm), EUR 1,846 (+24 EUR/sqm), EUR 1,172 (+4 EUR/sqm) and EUR 1,149 (+2 EUR/sqm). In the same month, apartment prices in Klaipėda decreased by 0.1% and the average price per square meter dropped to EUR 1,752 (-2 Eur/sqm).

In the past 12 months, the prices of apartments increased in all the biggest cities in the country: 3.3% in Vilnius, 5.6% in Kaunas, 5.4% in Klaipėda, 6.5% in Šiauliai and 6.4% in Panevėžys.

“At the beginning of 2025, the country’s housing market is showing impressive results. After a very strong growth in housing transactions in January and February this year, the increase in the number of transactions continued in March. According to the data of the State Enterprise Centre of Registers, in March this year, 19% more houses were purchased in the country and 20% more apartments were purchased than in the same month in 2024. And for example, in the capital of the country, January, February and March were historically the most productive months in the segment of older apartments, compared to the same months of the previous year.

The fact that the housing market is recovering rapidly is also reflected in the volume of new mortgage originations. According to the data of the Bank of Lithuania, in February 2025, the volume of new housing loans issued in Lithuania reached record highs – almost EUR 240 million, or 92% more than a year ago. The very good indicators of the housing market have also given optimism to home sellers, who are trying to sell their homes at ever higher prices.

But just when homebuyers seemed to have adjusted to the geopolitical tensions and could now plan more confidently in a falling interest rate environment, the world was shaken by the news that the US was imposing tariffs on imports to this country. Global trade markets are suddenly facing extreme challenges that could unbalance trade relations between countries and negatively affect the development of both the European Union and the Lithuanian economy. Especially in the event of a further escalation of US-China trade. Although it is difficult to assess the real impact of the duties imposed and their continuation at this stage, it is clear that this is a negative message for consumers and especially for those who are planning to make larger commitments, for example, in the case of home purchases.

According to the State Data Agency, the country’s consumer confidence indicator fell by 4 percentage points between February and March 2025, indicating that people’s expectations of their financial situation or the general economic situation of the country have deteriorated slightly. This may also be related to the recent, particularly active discussions on the planned changes to the Lithuanian tax system, which would inevitably increase the tax burden on both businesses and individuals. Meanwhile, the deteriorating expectations of the population may have an impact on the housing market, which is currently looking very strong, in terms of slowing down the pace of market recovery or the growth of sales prices”, said Raimondas Reginis, head of market research for the Baltics at Ober-Haus.

Full review (PDF): Lithuanian Apartment Price Index, March 2025