ARCO REAL ESTATE

    In September 2009, in comparison with August, the price decreasing is evaluated as insignificant – the prices of standard-type apartments in Riga decreased in September by 0,2 %. In the separate Riga housing estates and segments of standard-type apartments the prices are even a little bit increased. Taking into consideration the economical situation as a whole, especially unclearness with taxes, including progressive income tax, then in spite of price stabilization on standard-type apartment market, there are no objective reasons for further standard-type apartment price increase. In the separate housing estates the price changes are not established at all. In comparison with the previous month the quantity offer is the same. This circumstance also is evidence of the price stabilization.  The number of “low price” offer is decreased during the last month and the average price in separate housing estates a little bit increased. In spite of general situation on real estate market, there is still observed the activity in the expensive apartment segment. There are still in demand the apartments in good-type houses, with good location of the building and qualified finishing and often happen the deals. There also continues the price equalization between different standard-type apartments, the same as for 1-rooms apartments in different housing estates.

 

    The average price of a standard-type apartment in September decreased to 487 EUR/m². Thereby the prices were on average lower by 69.9 % than on July 1, 2007, when the average price of a non-renovated standard-type apartment was 1620 EUR/m². For its part, in comparison with January 1, 2009, the average price of a non-renovated standard-type apartment reduced by 47,9%.

 

    In the housing estates reviewed by ARCO REAL ESTATE in September the average price of a 1 room apartment was 498 EUR/m² and this price, comparing with the previous month, has decreased by 0.2%; the average price of a 2 room standard-type apartment was 496 EUR /m² and this price, comparing with the previous month, has stayed without changes; the average price of a 3 room standard-type apartment was 477 EUR/m² and this price, compared with the previous month, has decreased by 0.42%; and the average price of a 4 room standard-type apartment was 479 EUR/m² and this price, comparing with the previous month, has stayed without changes.

 

    In housing estates of Riga, comparing the prices of September 2009 with the prices of August 2009, the highest price decreasing was observed on Teika (-1%), like in July. However, the prices in Riga in September predominantly are not changed.

 

    Māris Laukalējs, ARCO REAL ESTATE member of the board, head of appraisal department: „During the last months there are concluded the bargains with both comparatively expensive apartments (the apartments with qualified finishing and good location) and with comparatively cheap apartments. As the result of it the average price of standard-type apartment more reflects mathematical value, but not the actual average apartment’s value. There are not a lot of deals with average class apartment. The average price could greatly differ taking separately according to the housing estates, type of apartment and number of rooms.

    Actually, strongly pronounced proposals of cheap apartments disappeared from the offers that all the time was below the market value. It allows make the conclusion that the average market value of standard-type apartment would not decrease. However unclear further development of national economics and inhabitants’ income is not the evidence of market value increase in the nearest future”.