The sales of the second month of summer continue to display a holiday season in the real estate sector: in Vilnius, 118 sales of new apartments and terraced houses were agreed, and in Kaunas – 62. However, despite the prevailing uncertainty, declining demand and rising interest rates, home prices continue to rise, with an all-time record price of EUR 3,253 per square metre in the capital, the highest ever in the city.
According to preliminary data from Citus analysts, in July in Vilnius, the average, indicative price of new apartments on offer (excluding terraced houses) increased by 2.5 per cent compared to June (EUR 3,175/sq.m.), reaching EUR 3,253/sq.m. In Kaunas, the prices of homes on offer were again adjusted to the negative side by 0.1 per cent, reaching EUR 2,183/sq.m. in July; at the end of June – EUR 2,186/s sq.m.
“We continue to observe uncertainty in the market, which has been reinforced by the European Central Bank’s decision to raise interest rates, so some buyers are waiting and holidaying, while others are reconsidering their decisions or taking a more serious look at the possibilities of purchasing property. On the other hand, developers are still limiting sales and raising prices for fear of not being able to control costs due to uncertain raw material prices.
However, despite this situation and rising interest rates, Vilnius recorded the highest average price per square metre in history. It reached as high as EUR 3,253 per square metre, which in litas would amount to LTL 11,231.96 per square metre. Although the demand is decreasing, the prices on the market continue to rise, which shows that there is no pressure to sell and sellers are not in a hurry,” says Šarūnas Tarutis, head of investment and analysis at Citus.
In July, 118 new apartments and terraced houses were reserved in Vilnius, while 3,812 remained on offer. Four new projects and two phases of existing projects have been added to the stock in the meantime, expanding the supply by 269 apartments. In Citus-managed projects in the capital, 5 apartments and terraced houses have been agreed in one month, but buyers are left with fewer and fewer choices, with only 91 vacant apartments.
In Kaunas, according to Citus experts, July was calm, with 62 new homes (flats and terraced houses) sold, and 7 in the company’s projects. In the temporary capital, analysts did not record a single new project or its stage. At the end of July, buyers could choose from 1,268 homes, while only 50 lofts in the Radio City project were available in Citus-managed projects.
In total, Citus sold 46 apartments and terraced houses in Lithuania, with the best performing project being Nemunas by CITUS. There are 277 units to choose from in the company’s managed projects.
“Compared to June (1,277 units), the housing stock in Kaunas decreased by only 9 units in July, although no new projects were launched. This was due to a number of cancellations due to the uncertain market situation. However, the example of Druskininkai shows that there will always be supply for an interesting product – Nemunas by CITUS sold a total of 34 apartments.
Nevertheless, we can see that the supply is slowly filling up, albeit with difficulty and in very small numbers. This indicates that we should see a new wave in autumn – buyers will make the decision to buy once they have evaluated and come to terms with the current situation, they will have more options to choose from, and therefore we predict a higher number of transactions,” says Š. Tarutis.