Good for Business, Latvia, Loan, Real Estate

In most parts of Riga, apartment prices grew 0.06-1.43%, and the average price of standard-design apartments in Riga reached EUR 695 per square meter in May. The highest prices were recorded in Teika neighborhood – EUR 831 per square meter, and the lowest in Bolderaja on the outskirts of the Latvian capital – EUR 478 per square meter.

Zarins noted increased activity in the segment of new housing developments meant for local buyers. Mortgage loans are now available at more attractive terms and monthly mortgage payments are lower than monthly rental which explains the increased activity of buyers – mostly young people in their early thirties with stable income.

More than a half of customers who buy apartments in new housing developments take mortgage loans to finance their purchase.

"A couple of years ago people rarely chose to reserve for themselves an apartment in a building still under construction. But a trend observed this spring shows interest from potential buyers already in the early stages of construction because many developers offer a discount of up to 10% in case of early reservation,” the CEO of Balsts said.

Demand for rental apartments still is higher than supply. Monthly rental prices vary between EUR 10 per square meter for apartments in new housing developments or freshly renovated houses in the Riga center and EUR 5.5 per square meter in apartments that need repair.

Customer activity keeps growing in the segment of private houses with most customers looking for private houses costing up to EUR 150,000 in the areas around Riga – such as Aadzi, Bergi and Salaspils from where it is easy to commute to Riga.