Home prices in Lithuania and Estonia have risen several times faster than the European Union average over the past five years, according to new data from the bloc’s statistics agency, Eurostat.
Eurostat figures show residential property prices have increased by nearly 80% in Lithuania since the beginning of 2021, the sharpest rise among the three Baltic States. Prices climbed 58% in Estonia and 51% in Latvia over the same period, compared with an EU average increase of 26%.
Margit Volt, head of housing loan development at Luminor Bank in Estonia, said the data, published earlier this month, reflected not only rapid price growth but also the high value people in the Baltic States place on homeownership.
“For Estonians and our southern neighbours, buying an apartment or a house is primarily associated with quality of life, a sense of personal security and the desire to own a home,” Volt said. “That is why demand for residential property remains high despite the very rapid rise in prices over the past five years.”
Based on Eurostat’s data, an apartment that cost 135,000 euros at the beginning of 2021 would now cost about 244,000 euros in Lithuania, 213,000 euros in Estonia and 203,000 euros in Latvia.
Volt said the rapid appreciation had become increasingly visible in everyday life, with affordability emerging as the main concern for families looking to buy homes.
“As a result, taking out mortgages to purchase well-maintained existing homes rather than newly built properties is becoming increasingly popular,” she said.
The data also show that residential property prices have substantially outpaced economic growth across the Baltic States.
Since the beginning of 2021, Lithuania’s real gross domestic product has grown by 14% and Latvia’s by 15%, according to Eurostat. Estonia’s economy, meanwhile, remains smaller than it was five years ago.
“Latvia’s and Lithuania’s post-crisis development has been fairly typical, with real estate prices rising faster than the economy,” Volt said. “Estonia’s situation is different and once again reflects our strong preference for homeownership. Although our country’s prosperity has not increased overall, buying and owning a home remains very important to us.” (LRT)