REVIEW OF BALTIC STATES REAL ESTATE MARKET 2002
Transactions of urban residential, commercial and industrial land
As in the previous year, the most active market with the highest prices is
residential real estate market in Riga, Jurmala and Riga’s region, which has the
biggest number of the objects of this market segment. Both in Riga and Jurmala it is
possible to observe a big range of land market prices, however it must be noted that
this year the average price of residential land (statistically) has slightly decreased in
Riga, which only testifies to the fact that the number of transactions at extreme prices
has decreased; on the other hand the prevalent price has reason, which is connected to
the limited availability of land within the city limits. The average price of the resident
land in Riga is 13.70 EUR/m2, but the price of the most attractive land in Riga’s
territory reaches approximately 40.00 EUR/m2. Residential plots are mostly offered
in the cities outskirts or in the vicinity of the city and the prices depend on service
roads and infrastructure.
The average price of residential land in Jurmala is 14.60 EUR/m2. Altogether
the average prices have remained on the level of previous year. There is a high
demand for residential land in the territory next to the beach dunes, where land price
reaches approximately 100.00 EUR/m2.
In Jelgava, Liepaja and Ventspils the average prices of residential land are
3.50 EUR/m2 to 7.20 EUR/m2. Liepaja has seen a steep rise in prices, which is
connected with favourable credit conditions and growing amount of construction but
at the same time with a limited availability of vacant land.
The average price of residential land in other regional centres of Latvia
amounts from 0.26 to 2.90 EUR/m2.
Real estate transactions with commercial and industrial land mostly take place
in the biggest cities of Latvia (Riga, Liepaja, Daugavpils, Ventspils, Jurmala). In
comparison with the previous year both commercial and industrial land prices have
notable increased. For example, in Riga the average price of commercial land is 30.90
EUR/m2, however, the land price in the centre of Riga reaches approximately 500.00
EUR/m2. The average price of commercial land in Liepaja is 30.90 EUR/m2. The
growth of prices in both cities is 25%.
The average price of industrial land in Riga is 21.10 EUR/m2, in Liepaja – 4.60
EUR/m2. In both cities the average price of industrial land has practically doubled.
Transactions of agricultural and forest land
Approximately 3 900 transactions (sales and leases) are registered in the State Land
Service’s real estate market database for the year 2002, the purpose of use of which is
agriculture, and approximately 1 700 real estate transactions the purpose of use of
which is forestry. This includes around 900 agricultural land leases.
One must add that the number of agricultural and forestry real estate transactions in
the year 2002 has increased by 18% in comparison to the previous year.
Average price of agricultural land in the state is 264.00 EUR/ha – it has practically
been preserved at the level of the previous year. The average size of a plot of land that
is involved in market transactions is 14 hectares.
REVIEW OF BALTIC STATES REAL ESTATE MARKET 2002
Average price of forestland (together with developing forest) in the sate is 630.00
EUR/ha – 13% higher than the average price in the year 2001. The average size of a
plot of land that is involved in market transactions is 13 hectares.
The range of rental prices of land used for agriculture in the state is still very large:
from 4.00 EUR/ha (in Latgale) to 50.00 EUR/ha (in Zemgale).
Analyzing the prices of agricultural land and the agricultural real estate market
activity by the regions of Latvia, one can observe a very close connection between the
price of land and the real estate market activity on the one hand and the common level
of the economic development of the area, the level of cultivation of agricultural land
and the size of arable land, as well as the location of the real estate in relation to the
capital city.
The highest levels of activity can be seen in the central regions of Zemgale, where
also the market prices of the land are the highest in Latvia (averaging 429.00
EUR/ha). The market of agricultural land in Latvia in the year 2002 has increased
interest of Latvian and foreign joint ventures for those lands, and in certain territories,
also the state’s long term credit program for obtaining of agricultural land.
The prices of forest land are closely connected to the value of existing trees (timber)
on the land, as well as the quality of service roads and the distance to the timber
processing plants and other timber purchasing places. It is possible to observe a
tendency that the price of forest land in regions is regulated by a small number of
forest land dealers. The buying and selling prices of agricultural and forest land by the
regions are depicted in the tables.
Transactions with plots in the countryside
The prices of residential land in the countryside vary a great deal both from region to
region and within each region of Latvia. The price of the land depends upon the
location of the land with respect to the seacoast and also other scenic places. The
distance from the residential plot to Riga and other larger cities is important. The
social economic situation of a particular territory also influences land value. For
example the price range of residential plots in the parishes of Riga’s region is within a
limits of 1.00 to 11.50 EUR/m2, which testifies to the influence of the value
influencing factors mentioned above.
The range of residential land prices in parishes of Kurzeme’s region is 0.20 EUR/m2
to 5.00 EUR/m2, in parishes of Zemgale –0.20 to 5.00 EUR/m2 and in parishes of
Latgale – 0.17 to 0.45 EUR/m2.
The average prices of residential land of Latvia’s regions are listed in tables.
The price of commercial land in Latvia’s countryside practically does not differ from
residential land prices, because the demand for land does not exceed supply. The price
per 1 m2 of industrial land is even slightly lower than prices of residential land,
because industry usually utilizes larger plots of land.