Tuesday, July 10, 2007

Baltic real estate update

To those who are following the developments in Baltic housing markets via this blog... Here is a news story from Eesti Paevaleht, one of major Estonian newspapers (via Latvian news agency LETA).

To summarize the article, Estonia has been having a housing boom as well... Lots of new construction. People reserving apartments in the to-be-built buildings with hope to resell them quickly and make quick money. Now, the new projects are built and the speculators are discovering that they can't resell the apartments for the price they hoped. It has gotten so bad that some of them prefer to walk away and lose the deposit that they paid to the developer (9000-25000 US dollars) rather than end up with a place that they can't resell.

Meanwhile, in Latvia, ... a real estate magazine did an investigation whether the apartment sellers have lowered the prices. They took 23 real estate ads from March and called up the sellers. 8 of them had sold their apartments, 4 had decided not to sell because they couldn't find a buyer who was willing to pay the price. The remaining 11 were still for sale and 9 of 11 sellers were ready to lower the prices... but only by small amounts, from 1% to 5.5%. No signs of big drop in prices.

Developing...

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