Slowdown of apartment price increase rate in the country’s capital
2018-02-15
The Ober-Haus Lithuanian apartment price index (OHBI), which records changes in apartment prices in the five major Lithuanian cities (Vilnius, Kaunas, Klaipėda, Šiauliai and Panevėžys), increased by 0.1% in January 2018 (remained unchanged in December 2017). The annual apartment price growth in the major cities of Lithuania was 3.4% (the annual apartment price growth in December 2017 was 3.6%).
In January 2018 apartment price increase was recorded in Panevėžys and Šiauliai, where prices increased respectively by 0.7% and 0.6% and the average price per square meter reaching EUR 580 (+4 EUR/sqm) and EUR 615 (+3 EUR/sqm). Meanwhile, in Vilnius, Kaunas, Klaipėda the same growth was recorded and was 0.1% with the average price per square meter reaching EUR 1,469 (+1 EUR/sqm), EUR 1,033 (+2 EUR/sqm) and EUR 1,038 (+1 EUR/sqm) respectively.
In the past 12 months, the prices of apartments grew in all major cities: 4.7% in Kaunas, 3.7% in Panevėžys, 3.5% in Šiauliai, 3.2% in Vilnius and 2.5% in Klaipėda.
‘Indicators of the housing market of the past years in individual major cities in Lithuania show a slowdown in the rate of increase of apartment prices in some cities, while the rate remains stable or, on the contrary, faster increase has been recorded in other cities.
The country’s capital city has seen the biggest change and the price increase curve sloped down most rapidly. In the past three years, the annual rise of apartment prices in Vilnius peaked in January 2017 to 7.1%. Since that time, almost every month a decline in the annual rise has been recorded in Vilnius totalling 3.9% in 12 months to current 3.2%. This is not surprising, because sufficiently rapid increase in apartment prices has been recorded in Vilnius in the past five years, so the existing price level and other factors prevent further rapid rise.
In the meantime, the situation is the opposite in Kaunas, where over the past few years price increase has been recorded. If at the end of 2015/beginning of 2016 the annual rise of apartment prices in Kaunas remained below 1%, at the end of 2017/beginning of 2018 it exceeded 4.5%. The situation in Klaipėda, Šiauliai and Panevėžys can be described as stable – compared to Vilnius or Kaunas the rate of increase in prices has seen little change over the past few years and the direction of price development is unclear’, Raimondas Reginis, Senior Research Analyst at Ober-Haus, said.