ARCO REAL ESTATE

• Local people generally choose a property in the price range of up to 100 000 EUR and are often looking for flats in new projects in all areas of Riga or for small family houses.

During the first four months of 2011 the prices of standard-type apartments decreased quite a bit, but the prices of properties situated in the central part of Riga and being in the range of at least 100 000 EUR, are though slightly but still growing.

One of trends in the local market that should be mentioned is "double selling". If some time ago there existed an interest in property exchange transactions, today such transactions are rare. Our customers are people, who want to sell a property and then buy another property in place, or those with good financial resources, who can afford to carry on these two processes simultaneously and who in the beginning carefully choose a property they like and only then start selling.

Local people generally choose a property in the price range of up to 100 000 EUR and are often looking for flats in new projects in all areas of Riga or for small family houses. Options to buy a house in this price range are very limited, so a property often is purchased in the vicinity of Riga – at Mārupe, Dreiliņi, Ādaži. „ People are still looking for "good and cheap properties", but those are particularly hard to find. Especially in case of "double selling" when people do not seek professional assistance, but decide to process the documents themselves, they are often faced with a situation where their property is already sold, but the owner of the chosen property suddenly decides to raise the price and due to the ill-considered documents the agreed price is not documented, and the property becomes much more expensive", explains the situation Ms Oļesja Bogodistaja, housing stock sales division manager of ARCO REAL ESTATE.

Local residents are not as solvent as foreign buyers, and rarely buy properties located in the centre of Riga within the price range of about 300 000 EUR and more.

Banks have started more active offering of loans in the market. According to observations made by ARCO REAL ESTATE, people applying for bank credits may be divided in following groups:

• Loans up to 70 000 EUR. Loans to such amount are mostly taken by persons turning to a bank for the first time and having a clean credit history. These are mostly people in the age range from 23 to 30 years.
• Requests for loans to around 100 000 euro are received also from residents of Russia. As it is known, if a non-resident of Latvia wants to submit documents applying for a residence permit, he/she must at his/her own expense purchase a property in Riga for an amount not less than 100 000 LVL. In most cases a non-resident chooses a property in the central part of the city with an area of 120 to 150 m², in the price range from 200 000 EUR to 300 000 EUR. Sometimes 2 small properties situated in the central part of the city are selected, to ensure that the total purchase value is 100 000 LVL or more. The supply of exclusive properties with a budget of up to 500 000 EUR is limited, and the demand exceeds the supply; however, on the overall background, such transactions are very rare. That is why the non-residents of Latvia often apply for a credit either for renovation of the property, or for the difference between the price of the property and his/her own investment in amount of 100 000 LVL.

Residents of Latvia, who can afford to buy a house and want to live in silence and in nature, in order to relax after a stressful working day, often prefer properties near the sea or nearby lakes, most often in the vicinity of Riga. Property prices in this segment vary significantly; however, the prices generally range from 200 000 EUR to 400 000 EUR.

Also penthouse-type apartments are demanded now. This segment is severely limited, and apartment has a specific added value, if the house has an elevator and a balcony or terrace. Most frequently searched properties are those with 2 or 3 bedrooms and modern or artistic design, as well as non-renovated apartments, which often are chosen by people of artistic nature.

Additional information:

ARCO REAL ESTATE
Oļesja Bogodistaja
Brīvības Street 39, Riga, LV 1010, Latvia
+371 6736 5555
+371 2868 8666

03.06.2011.