International Internet Magazine. Baltic States news & analytics
Wednesday, 01.04.2015, 12:23
Jurmala – the capital of new projects in Latvia
To visualize the location of new projects in Jurmala and thus facilitate the choice of an apartment for interested person, ARCO REAL ESTATE has developed an online map – bit.ly/JURMALA.
Despite the fact that the supply of new projects in Jurmala is broad and meets the most demanding tastes of potential buyers, the share of housing sold this year has grown quite insignificantly, namely, in the 1st quarter of the last year 34 transactions were concluded, while in this year during the same period the number of transactions has grown by 19%, and the number of transactions was 42.
As pointed out by Mr. M. Laukalējs, presently the Jurmala real property market is saturated with apartments in new housing projects, where the price per square meter ranges from 1,800 to 5,500 EUR. If you compare prices in Jurmala new projects with countries where the company ARCO REAL ESTATE is represented, such as Estonia and Bulgaria, the supply in this Latvian resort town is the most expensive. For example, in Pärnu, a resort town of Estonia, the price of one square meter in new projects is ranging from 1200 to 2500 EUR, and in Varna – from 700 to 750 EUR. Although the difference in price initially seems rather striking, the expert explains that the most expensive housing offered for sale are located in the dune area, where the possibility of building is limited but in most transactions (~ 70%) the amplitude of price per square meter in Jurmala new projects varies between 2300 and 3500 EUR.
Answering the question why non-residents select homes in the Jurmala new projects and are willing to pay quite large sums of money, Mr. M. Laukalējs stated: "The price category of the Jurmala new projects is determined by the prestige of the location, which has historically made the city a favourite destination for wealthy people. In addition to the status of the resort city, the characteristic features of Jurmala include the following objective factors: the proximity to the capital of the country, an airport and a seaport, which gives privileges to the city and directly affects the choice of the buyer in favour of Jurmala. These benefits can not be provided either by Estonian Pärnu resort, or Bulgarian Varna."
Mr. M. Laukalējs also indicates that non-residents when choosing a real property take into account the property's location, level of comfort, service quality, aesthetic appeal of the new project, including the design of the interior, and finally, compliance of the purchase price with the named criteria.
In turn, the recent amendments to the Immigration Law, by which there was increased the minimum purchase price of real estate, which allows non-residents to apply for a temporary residence permit in Latvia , will not cause significant changes in the real estate market of Jurmala, predicts the representative of ARCO REAL ESTATE. This opinion is based on the fact that in almost a quarter (23.8 %) of transactions made in the 1st quarter of 2014, non-residents have spent a sum of money, equivalent to or greater than the minimum amount laid down by the amendments to the law, or 250 000 EUR. In addition, in many transactions concluded in Jurmala the purchase amount was only a little bit lesser than the amount specified in the law, adds Mr. M. Laukalējs and says: " At least half part of the current supply of new projects exceed the purchase amount required to obtain a residence permit."
Speaking of the largest real estate transactions in Jurmala, the information received from the State Land Service confirms that in a deal concluded in September, 2013 an apartment in the new project "Dzintaru rezidence", No. 5, Madonas Street was bought at the price of 1,171,674 EUR; and in March of this year, a buyer paid 514 900 EUR in order to become the owner of an apartment in the new project "Aristo", located at No. 20/22, O.Kalpaka Boulevard.
Jurmala has long been renowned as the most favourite tourist resort town on the Baltic Sea, and its importance for the Latvian economy has not been lost today. When summer comes, this beautiful place is visited by a large number of travellers, who every year supplement the municipal budget, and whose demand for high-quality services helps the local businesses to survive in the highly competitive environment. Pooled data from the Central Statistical Office regarding Jurmala accommodation establishments show that in 2013, 147,867 tourists visited Jurmala – by 25 111 or 20.5% more than in 2012. Analyzing the statistical data by countries, we see that the first place in terms of visiting persons is traditionally occupied by Russia. Jurmala is the only city in Latvia, which in terms of volumes of construction of multi-apartment buildings can be compared with those observed during the Soviet time, informs the specialist of ARCO REAL ESTATE.
ARCO REAL ESTATE is one of the largest real estate companies in Latvia. It was founded in Estonia in 1992. The company is listed on the Tallinn Stock Exchange since June 2007. ARCO REAL ESTATE commenced its activity in Latvia 17 years ago and currently provides services in Riga, Saulkrasti, Jelgava, Limbaži, as well as in Liepāja, Ventspils and Jurmala. The company employs about 70 specialists of high professional qualification.