EIKA Development Director Martynas Žibūda:
“In the first half of 2019, the Vilnius housing market continues to surprise with its activity. During the second quarter of 2019, exactly the same number of apartments were sold in the Vilnius primary housing market as at the beginning of the year – 1,469 apartments, which is 68 percent more than in the same period last year. In 2019, an average of almost 500 apartments were sold per month, while last year the monthly average was 330 apartments. It seems that the consistent growth of income and population in Vilnius has a positive impact on the capital’s primary housing market.
The second quarter of this year continues the trend that has been observed for some time now – sales of medium and luxury class housing are growing significantly more than those of economy class. Medium and luxury class housing is almost entirely developed in the city center or near the center. The growing demand for this housing reveals the changing face of the city and changes in the lifestyle of Vilnius residents, i.e. the desire to live closer to the city center and reach all desired places faster, for example, with increasingly popular electric scooters.
Slightly less than sales, but the activity of developers also increased when comparing the second quarter of this year with the second quarter of 2018. During the second quarter of 2019, 26 percent more housing was offered to the market than during the same period in 2018. It is obvious that due to high demand, the supply grew most in the middle class. On the other hand, the market is able to absorb even the growing supply, and the number of vacant unsold apartments on the market remains almost unchanged: during the quarter it decreased by 1%, although compared to the same indicator a year ago it is 2% higher.
High buyer activity led to a statistical average housing price increase of 5 percent per year, although in the last quarter the average housing price decreased by about 0.5 percent and currently stands at EUR 2,006 per sq m. m. The largest price jump during the quarter was recorded in the economy class segment, where the price increased by about 4% to EUR 1,456/sq m. m. In this segment, several projects were offered to the market, the advantages and advantages of which over competitors allowed developers to start sales at a slightly higher price than the market price.
The growth of supply outpacing demand, the changing lifestyle of city dwellers, and moderate price growth are the most prominent trends this year.”
Facts
- During the second quarter of 2019, 1,469 apartments were sold in the primary housing market of Vilnius, which is as much as 68 percent more than in the second quarter of 2018 (875 apartments), and almost the same as in the first quarter of 2019, when 1,470 apartments were sold.
- The largest share of transactions was made up of middle-class housing sales – 49 percent of transactions, slightly less of economy class – 39 percent of transactions, and 12 percent of sales were in the luxury housing segment.
- Compared to the second quarter of last year, the number of middle-class housing buyers increased the most – by as much as 95 percent (720 apartments). Sales of luxury housing also almost doubled – by 89 (180 apartments).
- During the second quarter of 2019, the amount of unsold housing remained almost unchanged – it decreased by only 1 percent and currently stands at 4,300 vacant apartments, which is 2 percent more than at the same time last year.
- 20 percent of unsold apartments are completed apartments, about 18 percent are apartments under construction, and 62 percent of vacant apartments on the market are still under construction.
- The number of vacant apartments in all segments remained unchanged during the quarter, as almost the same number of apartments were sold as real estate developers offered in their new projects. The supply shrank the most in the luxury housing segment – by 15 percent, in the middle class the supply increased by 6 percent, and in the economy class – by 4 percent. decreased.
- In the second quarter of 2019, real estate developers offered 1,400 new apartments to the market, i.e. 26 percent more than in 2018, when construction and sales of about 1,100 apartments began.
- During the second quarter of 2019, the largest price change was in the economy class, where the price of apartments currently on the market is 4.3 percent higher compared to the first quarter of 2019 and 5.1 percent higher than a year ago. In the luxury and medium segments, prices decreased slightly during the quarter, by 1.4 percent and 0.4 percent, respectively. The price level currently reaches 1456 EUR/sq. m in the economy class, 2039 EUR/sq. m in the medium class and 3147 EUR/sq. m in the prestigious class.
- Due to the above-mentioned price changes and the reduced share of luxury housing in the supply, the total average price of new housing in Vilnius decreased by about 0.5 percent – to 2006 EUR/sq m.