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The average price of standard-design apartments in the Latvian capital Riga climbed 3.5% from the beginning of this year to EUR 696 per square meter in June.

Zarins said that in June the highest apartment prices were recorded in Teika neighborhood where they averaged at EUR 839 m2, while the least expensive apartments could be bought in

Bolderaja where the average price was 478 per square meter.

"We project this year's rise in standard design apartment prices to be the steepest in five years. At present, most of the market is dominated by local consumers, which is a positive and predictable signal of long-term growth," Zarins said, adding that a stable economic, political and demographic situation would also promote this growth.

Apartment prices in Riga are not showing any signs of dropping, and have been rising at least by 0.07-1.57% in most residential neighborhoods, the city center and new projects.

Balsts expects the rising demand for standard design apartments to fuel demand for new housing projects, which might be one of preconditions for steady market growth.

Clients are currently shopping for new 70-80 square meters-large apartments selling at about EUR 100,000.

The strong demand also promotes investments in the renovation of older properties which are being turned into tenement houses with 8 to 10 apartments.