http://eng.novonews.lv/news/2008/07/07/latvia_en/005953.html
Apartment Prices Might Fall 65% in Riga
Photo: D.Kiyenok, NovoNews archive
Apartment prices have fallen 20-30% in Riga during the past year. However, real property specialists warn that the tendency will be continued.
1 of July 2008 | Tuesday
[Print version]
Apartment prices have fallen 20-30% in Riga during the past year. However, real property specialists warn that the tendency will be continued. To reach an optimal verge, the prices must go further down at least by 30%. After cancellation of the easy housing loans, the apartment prices have significantly reduced in the Latvian capital.
Latvia's biggest real estate company Balsts estimates that the apartment prices have fallen by over 20% during a year. Another real estate company said the fall went over 25%, kauppalehti.fi reports.
Head of the real property consulting firm Fidius, Ruusa Hentila said based on her own calculations that the real property prices have already fallen some 25-30% in Riga's prestigious districts like Old Riga and a calm settlement nearby.
Hentila also predicted further drop of prices within the nearest months due to the slowed economy, GDP index and salaries. "There can be 60-65%-fall, until the prices reach an adequate verge," she remarked.
Whereas the most expensive apartments cost 4,000-5,000 EUR per m2 in Riga last year, now the prices have come down to 3,000-4,000 EUR. Following Hentila, the prices will continue to fall to 1,200-1,500 EUR per M2.
Latvia has a population of 2.3M people, GDP index of the country is 20.2 billion EUR (2007), i. e. 8,900 EUR per head. The average salary equaled to 645 EUR in the first quarter of 2008.