Analytics, Latvia, Real Estate

A typical example the situation in Ķengarags, where the relatively low price level caused an increase of number of transactions during the last months, which resulted in a significant reduction of the supply and an increase of the average price of one square metre.

Despite the fact that the average price of apartments in the largest housing estates of Riga continued to grow in August, which, according to Mr. M. Laukalējs, would lead to an increase in the supply of apartments, the opposite effect was observed. The expert explains this phenomenon by the fact that the transactions were carried out with the cheapest apartments, while the more expensive apartments remained non-demanded. Mr. M. Laukalējs also indicates that in case of an increase of the average price of one square metre, the owners are no longer willing to sell their properties at lower prices having existed until now, and this has led to a decrease of the total supply of apartments.

It has been observed that the largest growth of the average 1 m² price in the housing estates of Riga City since the beginning of 2014 was observed in Imanta (+7.4%), in the above-mentioned Ķengarags (+7.2%) and in Āgenskalns (6,4%). As indicated in the overview of the standard-type apartment market of August 2014, prepared by ARCO REAL ESTATE, also in other major housing estates of Riga the prices tend to increase this year.

Having summarized the number of apartments supplied, it can be concluded that the largest supply of apartments in August was in Purvciems, Āgenskalns and Imanta. But the housing estates where the number of apartments supplied was the smallest were Bolderāja and Vecmīlgrāvis. Evaluating number of offers in proportion to the size of the housing estate (by number of population), the largest supply was observed in Zolitūde (1.68), Mežciems (1.60) and Āgenskalns (1.46). In contrast, in Ķengarags (0.50), Vecmīlgrāvis (0.75) and Pļavnieki (0.76) the proportion between the number of the apartments offered and the population was the lowest.

The said overview contains also conclusion that the highest standard-type apartment prices in August 2014 still were in Teika, where the average price of 1m² has slightly decreased in August, reaching the level of 808 EUR. But the lowest average price of 1 m² has remained in Bolderāja – in August it remained to be 459 EUR.