Prices for properties in the regions are rising and the supply is decreasing

If you are interested in property in the regions, then it is high time to act, because prices are rising and supply is decreasing. Real estate experts conclude that buyers are ready to overpay for quality property both in Riga and in the regions. The real estate market in the housing segment had stopped for only a few months – when the pandemic started. December 2020 saw a record number of transactions. On the other hand, in 2021, everything has taken its course – the first months of the year were quieter, after which the market came to life again, according to the report of the first half of 2021 made by the real estate company Latio. “Our observations show that part of the population has quite large savings, which they are ready to spend on purchasing real estate. Until some time ago, residents were reluctant to spend their savings. Now some hoarders have apparently realized that it is the last moment to buy and are doing so. If you compare this year with the year before the pandemic, or the first half of 2019, both are equal in terms of the number of transactions,” says Evija Dzenīte, head of Latio’s Housing Sales Department. She also emphasizes that people are currently ready to pay even more, as indicated in the advertisement and mentioned in the evaluation: “If there are several buyers for one property, an auction is formed – whoever is ready to pay more will sell to him. This applies to apartments, houses and plots of land.” Great activity can be observed in the real estate market of the regions, especially in the cities of the regions. If previously the regions were forgotten and real estate could be bought cheaply, now it is almost impossible anymore, because prices are rising and no one is waiting for them to fall. If there is a desire to buy real estate in the regions at a relatively favorable price, now is the last moment to do so. “There is such a feature that people sell their properties in Riga and move to the regions. We hear it quite loudly, because those who move from the city to the countryside are written and talked about by the media. However, we cannot estimate exactly how many percent of transactions have had this kind of movement. Local residents also contribute to the activity in the regions, for example, when moving from a smaller city to a larger one. Valmiera, Liepāja, Jelgava and Daugavpils are especially in demand – where there is an active business,” comments E. Dzenīte. There is demand in the regions, but there is still a lack of adequate supply. If there are quite a few new projects currently under construction in Riga, which will be available next year, then in the regions, mostly houses are renovated and not built new. This is, of course, related to the increase in construction costs. The new projects could not be sold at such prices as in Riga, but the construction costs are identical, and the developers are not ready to give up the profit. Rental houses would be in demand in the regions, which developers now increasingly choose to build as part of new projects. But again – it is not profitable in the regions, because there are much lower rent prices than in Riga and Pieriga.

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