Apartment prices in three key Baltic capital cities Tallinn in Estonia, Riga in Latvia and Vilnius in Lithuania appear to have passed the bottom point and are now rising, indicating that the real estate sector in these areas has now weathered the falls experienced during the global economic downturn, according to a report by Ober Haus.

Prices in Tallinn, Estonia and in Riga, Latvia passed the bottom point in 3Q 2009, while prices in Vilnius, Lithuania only passed their bottom point in 2Q this year. Prices in Estonia and Latvia had started falling six months earlier than those in Lithuania.

Latvia had experienced the worst recession in the EU with an 18% fall in GDP during 2009 with residential prices falling 63.4% from their May 2007 peak. They have recovered by 6.7% in the capital Riga over the past 12 months to reach €906 psqm, however they remain 61% below their peak.

Estonia’s GDP fell by 14% in 2009, but is projected to increase by 2.5% in 2010, with transaction values in Tallinn rising 17.6% in the last 12 months to an average of €921 psqm, although they remain 46% below the 2007 peak.
In Lithuania the drop in real estate prices started later but GDP still fell by 15% in 2009 and prices are 40% below their December 2007 peak. Prices in Vilnius have continuously risen over the past four months but are still down 4.9% for the last 12 months and now average €1,180 psqm.