Financial Services, Lithuania, Loan, Real Estate

Swedbank data shows that in the first half of 2013 apartment sales in Vilnius increased by 32.6% year-on-year. In addition, real estate market growth was the biggest in Vilnius of all three Baltic state capitals. Newly built apartment sales were especially frequent – the number of transactions in the primary market increased by 50%. In some cases 50-60% of all available apartments were acquired in advance.

Swedbank senior economist said that changes in demand and supply were almost equal.

In the second quarter of 2013 housing affordability in Vilnius increased by 19 points year-on-year and reached 128.9.

According to Seckute, affordability increased in Vilnius the most due to the small housing loan rates. They were the smallest of all Baltic states for the third quarter in a row.

Apartment prices in Vilnius were falling in the second quarter although slower than before – prices were by 2.8% smaller year-on-year.

Rental yields in Vilnius and Kaunas have risen above historical average and were 6.6 and 8.1% respectively.

However, rental yields might have grown because rental costs increased noticeably and are too high at the moment. The analyst said that currently it was worthwhile to buy an apartment rather than rent one, as less would be paid in interest than in rental fees. Furthermore, apartment prices in Vilnius and Kaunas most probably are not overrated and are close to the real value.