As housing market activity declines, selling prices manage to rise
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 0.2% in March 2024. The annual apartment price growth in the biggest cities of Lithuania was 2.4% (a 2.2% increase was recorded in February 2024).
In March 2024 apartment prices in Vilnius, Klaipėda, Šiauliai and Panevėžys increased by 0.2%, 0.7%, 0.4% and 0.5% respectively, with the average price per square reaching EUR 2,593 (+4 EUR/sqm), EUR 1,662 (+11 EUR/sqm), EUR 1,100 (+5 EUR/sqm) and EUR 1,081 (+6 EUR/sqm). In the same month, apartment prices in Kaunas decreased by 0.1%, and the average price per square meter dropped to EUR 1,749 (-2 EUR/sqm).
In the past 12 months, the prices of apartments increased in all the biggest cities in the country: 1.9% in Vilnius, 2.7% in Kaunas, 3.8% in Klaipėda, 1.9% in Šiauliai and 2.3% in Panevėžys.
“Despite the continued decline in overall activity in the country’s housing market, house sales prices in the country’s major cities are showing resilience and are even managing to continue to climb upwards slowly. According to the data of the State Enterprise Centre of Registers, in the first quarter of 2024, compared to the first quarter of 2023, there will be 13% fewer purchases of both flats and houses in Lithuania. In the same period, almost 5% fewer older apartments were purchased, while 40% fewer acquisitions of newer apartments were registered in the country. The decline in new housing construction, which started in 2023, means that this year there are significantly fewer apartment transactions in new construction projects. This also leads to a greater overall decline in housing market activity.
The fact that sales prices of apartments have recently remained broadly stable or even managed to increase is well illustrated by the price dynamics of the largest and most popular housing segment in the country’s major cities. “According to Ober-Haus estimates (based on registered sale-purchase transactions), in the first quarter of 2024, the median selling price per square metre of 2-room apartments in old-built apartment blocks in typical residential districts of Vilnius was EUR 1,939/sqm, or 1.9% more than in the same period in 2023. In the same period in Kaunas, the median selling price per square metre of such apartments was EUR 1,416 per square metre (1.7% more than in the first quarter of 2023), and in Klaipėda – EUR 1,316 per square metre (7.4% more than in the first quarter of 2023).
This shows that, despite the generally negative sentiment still prevailing in the property market, home sellers are able to withstand the pressure from potential buyers and are not making any major adjustments in the selling price. So far, we observe that some home sellers are trying to adapt to the slower market pace and are adjusting their over-optimistic expectations. However, those sellers whose properties are sold at market price sooner or later find their buyers. It is the sellers’ calmness and their ability to wait longer for buyers that is responsible for the fact that the overall change in house prices in the country’s major cities continues to be positive, albeit with a slight upward bias,” says Raimondas Reginis, Research Manager for the Baltics at Ober-Haus.
Full review (PDF): Lithuanian Apartment Price Index, March 2024
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