The average price per square meter in Rīga new projects decreased per 50 EUR in residential areas in the first quarter of this year in comparison with the end of the last year, and was at the position of 1 410 EUR (- 3.4 %), while it decreased until 2 510 EUR/m² for the center apartments, falling per 40 EUR/m² or 1.6 % overall, informs the ARCO REAL ESTATE Member of the Board Māris Laukalējs.
The recession of the typical price does not indicate the total price level decrease, but the real transaction structure change, i.e., the transaction amount with cheaper apartments in the new projects increased essentially. For example, the amount of transactions with the new projects located in residential areas within the price range from 600 to 800 EUR/m² increased per 37.5 % during the first months of this year.
Contrary to what was forecasted, the average price of the new projects located in residential areas decreased essentially after nine concluded transactions in Čiekurnams project in the price range from 600 to 800 EUR/m². “This is a comparatively big transaction proportion in the overall amount that caused essential average price changes,” admits the expert.
Answering the question regarding the issue how this untypically low price for the new project dwellings can be explained, M. Laukalējs emphasizes that this building is not a typical newly erected building, but rather a reconstruction object. Also, the expert concedes a forced character of the possible transactions.
“As far as the indicated price increase in the first quarter is related to one project transaction proportion in the overall amount (29), not the common market tendencies, we still maintain the previously forecasted small price increase tendency in the second quarter of this year,” forecasts M. Laukalējs.
The ARCO REAL ESTATE observations presents the evidence that the real estate market activity in the new project segment kept decreasing at the beginning of 2015: in comparison with the indicators in the corresponding period, the amount of transactions with the new project apartments in Rīga residential areas and in the center decreased almost by half (- 49 %).
In the residential areas, where 2 room dwellings became the most marketable during the first quarter of this year, the most transactions (61) took place in the price range from 1000 to 1400 EUR/m², while in Riga center, where demand for 2 and 3 room apartments prevailed, the most transactions (29) took place in the price range from 1 800 to 2 200 EUR/m².
Looking at transaction amount change by the total transaction sum it is found that the real transaction amount in the range from 30 000 to 50 000 EUR grew per 65%. On the contrary, in the price range from 50 000 to 120 000 EUR, where the most transactions took place last year, a transaction amount decrease per 54 % was found, specifies M. Laukalējs.
Regarding the transaction sum over 250 000 EUR, which is the minimal threshold to obtain the temporary residence permit, only four transactions took place in the first quarter of this year, which is per 75 % less than in the fourth quarter of 2014, and per 85 % less in comparison with observations in the third quarter last year.