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Development has been observed in the real estate market in 2013 both in Riga and regions of Latvia, stated Mr. Māris Laukalējs, Member of the Board ARCO REAL ESTATE at the press conference arranged by the Company specifying that "the past year was more productive than 2012, since the total number of transactions had sharply increased."
The main trend in 2013 in the real estate market was a significant increase in the number of transactions in all segments with a little price growth, which secured development of the Latvia real estate market in a positive direction, as opposed to the year 2012 when there was observed dynamic development of the segment of new projects and the Riga city central part apartments and slow development or stagnation of the standard-type apartment and building lands market, compares Mr. M. Laukalējs.
As stated in the Latvian real estate market report of year 2013 prepared by ARCO REAL ESTATE, a specific situation was observed in the standard-type apartment segment, where a significant increase of the number of purchase transactions dominated, but the price increase compared with 2012 was minimal. Such minor price changes were caused by the continued dominance of forced-sale transactions in the market.
As stated in the report, a significant increase in the number of transactions was also endowed by the percentage of relatively low-price properties in the supply and more favourable conditions of the banks for issue of loans in respect of properties taken over by banks. Although the volume of new loans in 2013 grew, bank loan portfolios continued to decline, which was positively influenced both by the 'bad' loan write-offs and repaid loans.
The representative of ARCO REAL ESTATE indicates that the most active market segments in 2013 in Riga and its surrounding areas were transactions with apartments in the central part of Riga, apartments in newly built apartment buildings, single-family dwellings, as well as qualitative building land. Increased activity was observed in the apartment and the private house rental and commercial space rental market. The least interest was for apartments in wooden buildings of Riga, undeveloped building land, as well as low-quality commercial space. The expert also adds that the commercial land segment is still inactive.
It is stated in the report that in turn, the most active real estate market segments in regions of Latvia where a price increase had been observed, in 2013 were as follows: agricultural and forestry land, standard-type apartments and rural estates, while the most passive segments were all kinds of building lands and non-residential premises.
In 2013, the non-residents continued to actively buy real estates in Latvia to obtain a residence permit. The most popular places for investments by non-residents still were Riga and Jūrmala as well as Ozolnieki and Cēsis.
Demand in the new housing segment has remained stable, and the interest for new apartment building development and construction increased. Although the prices for apartments in newly built houses in and around Riga rose by 10 - 12 %, the total number of newly built apartments is still very low and in 2013 made only 21% of the level of 2007.
04.03.2014.