LATVIAN REALESTATEMARKET OVERVIEW 2007 CONTENTS CONTENTS 1.Introduction 2 2.Apartmentbusiness 5 2.1.GeneralOverview 5 2.2.Low-storiedwoodenbuildings 10 2.3.ApartmentsintheCentralpartofRiga 11 2.4.Newdwellinghouses 12 2.5.ApartmentmarketinthevicinityofRiga 15 2.6.Marketofnewdwellings locatedinthevicinityofRiga 16 2.7.Summaryofapartmentmarket 17 3.Hireofresidentialpremises 26 3.1.Rentofapartments 26 3.2.Rentofprivatehouses 27 4.One-familyprivatehouses 28 4.1.Generaloverview 28 4.2.One-familyprivatehouses inthevicinityofRiga 28 4.3.One-familyprivatehousesinRiga 29 4.4.Newlivinghousevillagesandrowhouses 30 5.Landpropertiesforerectionof one-familyhouses 32 5.1.Generaloverview 32 5.2.LandplotsintheRigacity 33 5.3.LandplotsinthevicinityofRiga 33 5.4.AgriculturallandinLatvia 36 7.Officepremises 42 5.4.1.Landforrecreationalneeds 36 RealestatemarketintheregionsofLatvia 5.4.2.Landforagriculturalneeds 37 Jūrmala 44 5.4.3.Landfortimbercuttingpurposes 37 Jelgava,regionofZemgale 46 5.4.4.Landpurchaseforresale 37 Sigulda 48 6.Landpropertiesforindustrialand Saulkrasti 49 commercialbuildings 38 Cēsis 50 6.1.Landforcommercialbuildings(shoppingcenters, Liepāja 51 salons,multi-apartmenthousesetc.) 38 Ogre 52 6.2.Landpropertiesforconstructionofproduction EasternVidzeme(Madona,Gulbene,Alūksne) 54 andlogisticsorindustrialparkareas 39 6.Marketofretailpremises 41 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 1 CONTENTS CONTENTS 1.Introduction 2 2.Apartmentbusiness 5 2.1.GeneralOverview 5 2.2.Low-storiedwoodenbuildings 10 2.3.ApartmentsintheCentralpartofRiga 11 2.4.Newdwellinghouses 12 2.5.ApartmentmarketinthevicinityofRiga 15 2.6.Marketofnewdwellings locatedinthevicinityofRiga 16 2.7.Summaryofapartmentmarket 17 3.Hireofresidentialpremises 26 3.1.Rentofapartments 26 3.2.Rentofprivatehouses 27 4.One-familyprivatehouses 28 4.1.Generaloverview 28 4.2.One-familyprivatehouses inthevicinityofRiga 28 4.3.One-familyprivatehousesinRiga 29 4.4.Newlivinghousevillagesandrowhouses 30 5.Landpropertiesforerectionof one-familyhouses 32 5.1.Generaloverview 32 5.2.LandplotsintheRigacity 33 5.3.LandplotsinthevicinityofRiga 33 5.4.AgriculturallandinLatvia 36 7.Officepremises 42 5.4.1.Landforrecreationalneeds 36 RealestatemarketintheregionsofLatvia 5.4.2.Landforagriculturalneeds 37 Jūrmala 44 5.4.3.Landfortimbercuttingpurposes 37 Jelgava,regionofZemgale 46 5.4.4.Landpurchaseforresale 37 Sigulda 48 6.Landpropertiesforindustrialand Saulkrasti 49 commercialbuildings 38 Cēsis 50 6.1.Landforcommercialbuildings(shoppingcenters, Liepāja 51 salons,multi-apartmenthousesetc.) 38 Ogre 52 6.2.Landpropertiesforconstructionofproduction EasternVidzeme(Madona,Gulbene,Alūksne) 54 andlogisticsorindustrialparkareas 39 6.Marketofretailpremises 41 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 1 INTRODUCTION GENERAL INDICATIONS OF ECONOMICS 1. INTRODUCTION RIGIBORand EURIBOR6 monthrates,years 2001-2007 Themarketanalysisoverviewpreparedby 14,00 SIA „ArcoRealEstate” providesconcentratedinformation ontheLatvianrealestatemarketintheyear2007.The 12,00 overviewprovidesabriefreportonthemainsectorsofthe 10,00 realestatemarket: 8,00 • saleandpurchaseofapartments; 6,00 • buildingofnewmulti-apartmenthouses; 4,00 • ofhiringresidentialpremises; 2,00 • one-familyprivatehouses; 0,00 • landestates(forbuildingofone-familyhouses); • agriculturalland; • landestates(forconstructionofindustrialand 2001.01.01 2001.04.01 2001.07.01 2001.10.01 2002.01.01 2002.04.01 2002.07.01 2002.10.01 2003.01.01 2003.04.01 2003.07.01 2003.10.01 2004.01.01 2004.04.01 2004.07.01 2004.10.01 2005.01.01 2005.04.01 2005.07.01 2005.10.01 2006.01.01 2006.04.01 2006.07.01 2006.10.01 2007.01.01 2007.04.01 2007.07.01 2007.10.01 publicbuildings); *Source:BankofLatvia Rigibor6M Euribor6 M • salesspacemarket; • officespacerentalmarket; Weightedaverageinterestratesofcreditsservedoutforhouseholds(EUR)fordwellingpurchase • realestatemarketintheregionsofLatvia. atthebeginningofperiodinLatvia Theoverviewoftherealestatemarketanalysisshows 7,00 thevaluesoftheestatesoftherespectivemarketsectors attheendofthereportingyearandalsoprovides 6,00 informationontheeventsinthesectorintheyear2007. 5,00 Sourcesofinformationusedfortheanalysisperformed 4,00 aretherealestatetransactionsdatabaseofSIA „Arco 3,00 RealEstate”,theinformationprovidedbycooperation 2,00 partnersandpubliclyavailableinformationsources,aswell 1,00 asinformationaggregatedbytheCentralStatistics Bureau,theLandRegisterandtheBankofLatvia. 0,00 July July July May May May April April June April Themarketanalysisoverviewisintendedforabroad June June March March March August August August January January January October October February February targetaudience,whoseactivitiesorinterestsare Februāris December December November November September connectedwiththeLatvianrealestatemarket,including September September privatepersons,investmentfunds,realestatecompanies, 2005 2006 2007 commercialbanksandgovernmentalinstitutions. *Source:BankofLatvia Till1year 1–5 years 5–10 years Morethan10years Pleaseaddressyourproposals,commentsorqueriesto SurveyDivisionofSIA „ArcoRealEstate” at: Availablehousingattheendoftheyear(totalareainmillionm²) 70 20aLāčplēšastreet,Riga 58,7 55 55,4 56,1 57 Phone67365556;fax67365557 60 52,9 52,7 53,5 53,5 50 MārisLaukalējs,HeadofSurveyDepartment 40 E-mail:[email protected] 23,6 23,9 24,3 24,8 25,7 30 19,9 21,3 22,6 22,8 LindaVanaga,MarketAnalystofSurveyDepartment 20 E-mail:[email protected] 10 0 1990 1995 2000 2001 2002 2003 2004 2005 2006 *Avots:CSB Housingfund Averageperoneresident,m² 2 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 3 INTRODUCTION GENERAL INDICATIONS OF ECONOMICS 1. INTRODUCTION RIGIBORand EURIBOR6 monthrates,years 2001-2007 Themarketanalysisoverviewpreparedby 14,00 SIA „ArcoRealEstate” providesconcentratedinformation ontheLatvianrealestatemarketintheyear2007.The 12,00 overviewprovidesabriefreportonthemainsectorsofthe 10,00 realestatemarket: 8,00 • saleandpurchaseofapartments; 6,00 • buildingofnewmulti-apartmenthouses; 4,00 • ofhiringresidentialpremises; 2,00 • one-familyprivatehouses; 0,00 • landestates(forbuildingofone-familyhouses); • agriculturalland; • landestates(forconstructionofindustrialand 2001.01.01 2001.04.01 2001.07.01 2001.10.01 2002.01.01 2002.04.01 2002.07.01 2002.10.01 2003.01.01 2003.04.01 2003.07.01 2003.10.01 2004.01.01 2004.04.01 2004.07.01 2004.10.01 2005.01.01 2005.04.01 2005.07.01 2005.10.01 2006.01.01 2006.04.01 2006.07.01 2006.10.01 2007.01.01 2007.04.01 2007.07.01 2007.10.01 publicbuildings); *Source:BankofLatvia Rigibor6M Euribor6 M • salesspacemarket; • officespacerentalmarket; Weightedaverageinterestratesofcreditsservedoutforhouseholds(EUR)fordwellingpurchase • realestatemarketintheregionsofLatvia. atthebeginningofperiodinLatvia Theoverviewoftherealestatemarketanalysisshows 7,00 thevaluesoftheestatesoftherespectivemarketsectors attheendofthereportingyearandalsoprovides 6,00 informationontheeventsinthesectorintheyear2007. 5,00 Sourcesofinformationusedfortheanalysisperformed 4,00 aretherealestatetransactionsdatabaseofSIA „Arco 3,00 RealEstate”,theinformationprovidedbycooperation 2,00 partnersandpubliclyavailableinformationsources,aswell 1,00 asinformationaggregatedbytheCentralStatistics Bureau,theLandRegisterandtheBankofLatvia. 0,00 July July July May May May April April June April Themarketanalysisoverviewisintendedforabroad June June March March March August August August January January January October October February February targetaudience,whoseactivitiesorinterestsare Februāris December December November November September connectedwiththeLatvianrealestatemarket,including September September privatepersons,investmentfunds,realestatecompanies, 2005 2006 2007 commercialbanksandgovernmentalinstitutions. *Source:BankofLatvia Till1year 1–5 years 5–10 years Morethan10years Pleaseaddressyourproposals,commentsorqueriesto SurveyDivisionofSIA „ArcoRealEstate” at: Availablehousingattheendoftheyear(totalareainmillionm²) 70 20aLāčplēšastreet,Riga 58,7 55 55,4 56,1 57 Phone67365556;fax67365557 60 52,9 52,7 53,5 53,5 50 MārisLaukalējs,HeadofSurveyDepartment 40 E-mail:[email protected] 23,6 23,9 24,3 24,8 25,7 30 19,9 21,3 22,6 22,8 LindaVanaga,MarketAnalystofSurveyDepartment 20 E-mail:[email protected] 10 0 1990 1995 2000 2001 2002 2003 2004 2005 2006 *Avots:CSB Housingfund Averageperoneresident,m² 2 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 ARCOREALESTATE • OverviewofRealEstateMarketinLatvia • 2007 3 GENERAL INDICATIONS OF ECONOMICS APARTMENT BUSINESS 1 1.1.GENERALOVERVIEW significantlyreducedthenumberoftransactionsofreal MortgageloansgrantedbyLatviancommercialbanks(inmillionLVLattheendofperiod) estate.Besides,aftertheseamendmentsinlaws 2.1.GeneralOverview relativelyhighmonthlysalaryincreasewasobserved, 2007.* 7359 , 9 0 Duringthefirsthalfof2007(tillmiddleApril) whichmostlikelyisrelatedtolegalizationofmonthly 2006. 5311,00 apartmentpricesincreasedrelativelyrapidlybutafterthis salaries. periodtherapiddecreaseofdemandwasobserved,which 2005. 2806,70 • Limitinginstrumentsofspeculativetransactions: resultedinpricefallinallsectorsofrealestatemarket, 2004. 1392,20 includingapartments.Generalapartmentpricedecrease • IncreaseofLandRegisterfeeandmortgage 2003. 772,60 sinceApril2007wasonaverage15-20%. registrationfee 2001. 235,90 Thus,astheresultofdemandandpricedecrease: AsofApril2007,largerfeeforextraregistrationof realestatehasbeencollected.Thisamendmentmainly 2000. • priceshavedecreasedinthecentreofRigaandin