For reliable real estate, Europe's east still leads the way

Photo credit: Johan A

Apartment prices have dropped in recent months, but the Baltics are still going strong, according to the latest figures. The Ober-Haus Baltic Apartment Price Index found that the prices of flats in the region fell on average, but that they are still higher than in 2010.

The Batlics have been growing consistently over recent months, but in Vilnius, October saw prices drop by 0,2 per cent, marking a decline in the rate of growth – a rate of 1.9 percent compared to 2.4 percent in the previous month. However, this decline only occurred “in the old apartment sector”, according to Property Wire.

Given that new apartment prices remained constant and that 1.9 percent growth is still a positive sign of increase, confidence remains quite high in the Baltics.

Prices fell in Vilnius too – by 39.2 per cent, when compared to the previous peak price tags. But Kaunas and Paneveys prices stayed the same, again proving that while a dip has occurred, there’s certainly no need to panic at the monthly slowdown.

Indeed, apartment prices in Riga actually increased. Rising by 1.8 percent in October, the value of Riga’s flats jumped by an average of 5.3 per cent over the last year. That’s still a decrease from the peak in 2007, but the market remains on the up.

In Tallinn, too, the average apartment price fell by 4.2 per cent in October. This slip followed a strong increase of 7.4 percent in September. It sounds bad, but Property Wire adds that “compared to a year earlier, the average apartment price [in Tallinn] is up 8.9 percent”.

With flats on the market at €1,082 per square metre, overseas buyers can be pleased that prices are dropping, but a look at the bigger picture suggests that the Baltics – and Poland, where market activity is following a similar pattern – are still giving investors good bang for their buck.

October looks grim, but on an annual scale, prices in both regions are performing well, especially compared the more fluctuating and less predictable Western countries. Once again, when it comes to reliable real estate, Europe’s east is leading the way.