According to Judita Gedutienė, Commercial Director of “Omberg Group,” the emerging difference reflects the purchasing power of buyers in major cities.
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“In Vilnius, new housing prices have already reached a level where fewer and fewer buyers can choose non-economy class housing. People do not give up plans to acquire new housing, but more often choose smaller areas or non-central city districts. In Kaunas, prices remain more moderate, and buyers still have more options to choose not only by price but also by housing location,” says J. Gedutienė.
The difference between economy and middle class in Vilnius is 1000 euros
At the end of July, 387 new apartments were sold in Vilnius, 1.3% more than in June. Although the monthly result remained close to the June level, the sales structure noticeably changed. This also corresponds to the trend of slowing summer transactions.
Economy class housing accounted for 65% of all sales in July, the share of middle class decreased from 33% to 28%, and prestige class from 11% to 8%.
Buyers’ choice shifted towards economy class at a time when supply prices rose in all segments of the capital’s market. Economy class housing increased in price to 3436 Eur per square meter in a month. The price of middle class grew the fastest by 2.1%, to 4408 Eur per square meter, while prestige class housing increased slightly to 6853 Eur per square meter.
“The price difference between economy and middle class in Vilnius is already approaching 1000 Eur per square meter. In the case of an average-sized apartment, this can mean about a 50 thousand euro difference. Under such circumstances, for some buyers, economy class housing becomes not only the most rational but also the only financially affordable option,” notes J. Gedutienė.
The supply of new housing in Vilnius continued to grow in July. The market was supplemented by five new projects or their stages, offering 417 apartments. At the end of the month, the stock of unsold apartments was 6074, half a percent higher than in June.
The most apartments were sold in Pašilaičiai in July – 71. In Verkiai, 43 preliminary sales agreements were made, and in Justiniškės – 37.
In Kaunas, half of the sales were middle class housing
In Kaunas, 62 new apartments were sold in July, almost 5% less than in June. However, unlike in Vilnius, buyers here shifted from economy class to higher segments.
The share of economy class decreased from 57% to 37% in a month. Middle class housing already accounted for 50% of all sales, compared to 34% in June. The share of prestige class increased from 9% to 13%.
This choice is supported by a more moderate price level. Economy class housing in Kaunas cost on average 2968 Eur per square meter, middle class – 3520 Eur, and prestige class – 4400 Eur. Prices changed slightly.
“In Kaunas, middle class housing can still cost about the same or even less than economy class housing in Vilnius. Therefore, some Kaunas buyers can afford to choose a higher segment project, a better location, or a more spacious apartment without straying too far from the initial budget. July’s results clearly show how different price levels shape buyer behavior,” says J. Gedutienė.
The stock of unsold new apartments in Kaunas decreased by 4.2% in a month – to 1161 units.
The result in Klaipėda was shaped by the prestige segment
In Klaipėda, 26 new apartments were sold in July, a significant drop of almost 60% compared to June. Economy and middle class housing each accounted for 13% of sales, while the prestige class share reached as much as 74%. However, such proportions are due to the relatively small number of sales.
In Klaipėda, prices of economy and middle class housing did not change over the month and were 2642 and 2897 euros per square meter, respectively, while prestige class increased to 5285 Eur per square meter.
The overall sales activity in July remained below the annual average, but this is typical for the summer season. The most notable change of the month was not the total number of transactions, but the different direction of buyers in Vilnius and Kaunas: rising prices in the capital strengthened demand for economy class housing, while more moderate prices in Kaunas allowed buyers to more often choose middle and prestige class housing.
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