How much luxury apartments cost in major Lithuania cities?

Over the past few years, Vilnius has recorded a rapid increase in the supply of higher-class apartments. On the other hand, the share of middle and prestigious-class apartments has been growing in the overall volume of the supply of new apartments. For instance, three years ago as many as 65% of the apartments built in Vilnius in 2013 were economy class, with only 6% being more expensive prestigious class apartments. The current trends and the statistics of 2016 are showing a different picture. According to the data of Ober-Haus this year more than 700 prestigious class apartments will be built in the capital, with sales prices (without final fit-out) more than EUR 2,000 EUR/sqm; and will account for as much as 19% of the year’s total supply.

Currently in Vilnius the prices of the most expensive new apartments with partial finish and fully completed old construction (in historical buildings) generally do not exceed 3,200-3,500 EUR/sqm. However, developers are fairly optimistic, and expect to sell new apartments in the capital’s most attractive locations (central part of the city and the Old Town) for 4,000-5,000 EUR/sqm. The most daring housing developers in Kaunas and Klaipėda have already implemented or are developing higher class apartment projects, in which the price per square meter is 2,000 EUR. It should be noted, however, that in both Kaunas and Klaipėda prices for the most expensive apartments (of old and new construction) are generally below 1,800-1,900 EUR/sqm.

What are the data of the official statistics, and what are the apartment purchase-sale deal prices in the most expensive segment? Since the price levels in the country’s major cities are different, in Vilnius the sample was made up of all apartment deals registered during the first six months of this year, and in which the square meter price exceeded 3,000 EUR (parking spaces and storage rooms were excluded). In Kaunas and Klaipėda, the selection included apartments with a price per square meter below 1,800 EUR. During the first six months 39 such apartments were sold in Vilnius, and 6 and 5 apartments, respectively, in Kaunas and Klaipėda. The share of such sales transactions in the overall sales statistics is especially small. According to the calculations of Ober-Haus, the share of the most expensive apartments in the overall number of sales transactions was 0.8% in Vilnius, and 0.3% in Kaunas and Klaipėda.

In Vilnius, the average price for such apartments was 3,313 EUR/sqm (average area – 80 sqm), in Kaunas – 2,052 EUR/sqm (average area – 52.sqm), Klaipėda – 2,005 EUR/sqm (average area – 73.sqm). The most expensive apartment sold in Vilnius in H1 2016 was in the newly constructed apartment building at Šiaulių St. – a 130 sqm apartment with car parking places was sold for 560,000 EUR (4,000 EUR per sqm without the parking space price). Other apartments sold for more than 3,000 EUR/sqm were sold in the central part of Vilnius, the Old Town, Užupis and Žvėrynas districts (Gedimino Ave., V. Mykolaičio-Putino St., Šiaulių St., Polocko St., Aušros Vartų St., Olimpiečių St., Užupio St. Trakų St., Odminių St., J. Basanavičiaus St., Šaltinių St., Šv. Mykolo St., Krivių St., M. K. Čiurlionio St., Šv. Mikalojaus St., Malūnų St., Mindaugo St., A. Smetonos St., Konstitucijos Ave., A. Jakšto St., Tilto St., Blindžių St.). In Kaunas the highest price per square meter was paid for an apartment in the Old Town, Raguvos St.; a 65 sqm sized apartment in a fully refurbished old construction building was sold for 155,000 EUR (nearly 2,400 EUR per sqm). In Klaipėda the highest price per square meter was paid for an apartment in the Old Town, Danės St.; a 78 sqm apartment in an old construction building was sold for 180,000 EUR (nearly 2,300 EUR per sqm).

“Such trends in the apartment sales market show that the most expensive housing segment market was a little livelier only in Vilnius, where on average 6-7 such deals are struck per month; Kaunas or Klaipėda had only one such transaction per month”, Saulius Vagonis, Head of Valuation & Analysis at Ober-Haus, said. The sample of such property is fairly marginal even in the capital (i.e. less than 1% from total take-up), and developers or owners of luxury class housing have to work very hard to sell such property to only a limited number of buyers. True, one of the relevant reasons for such a small number of transactions is the limited supply of luxury class housing over the past few years and especially in newly constructed buildings. However, the situation is evolving, and clearly the newly developed projects are improving the overall performance indicators of the sector. For instance, 36% of the 39 most expensive apartments sold in Vilnius during the first six months of the year were in old buildings (built before 1990), 28% were sold in buildings constructed in 2004–2015, and 36% were sold in buildings completed this year.

The ongoing construction of luxury multi-apartment buildings (and especially in the capital), the process of signing preliminary purchase-sale contracts, and the sale prices as declared by the developers makes it likely that in the near future we can expect to see even more intriguing, and probably record acquisition levels, and an increased volumes in the sales of this type of housing.

Full review (PDF):  Lithuania Residential Market Commentary Q2 2016