Baltic property markets continue to struggle

Country:  Estonia; Latvia; Lithuania

12 August 2009

The Baltic property developer, Merko Ehitus, saw its net income tumble by 70% in the second quarter of this year, as the recession in the Baltic States continues to adversely impact on the region’s construction and housing sectors.

The property firm’s net income fell by close to £2.4m, while revenue dropped 33% to around £46m, due mainly to the Baltic property downturn.

The price of property in Lithuania, property in Estonia, and property in Latvia, has tumbled over the past 18 months or so, recording falls of in excess of 30% each since the peak of the markets in late 2007.

Situated in Northern Europe along the Baltic Sea, Latvia, Estonia, and Lithuania, have changed dramatically, drawing ever closer to Western Europe, both politically and economically, since gaining independence from the Soviet Union in 1991.

The countries experienced a significant property price boom between 2004 and 2006, creating a property bubble that has since burst spectacularly.
The Latvia property market is currently in an awful state, with the country’s economy in serious danger of going bust.

Anyone thinking of buying property in the Baltic nations, are advised to consider the Lithuania property market, which continues to attract greater demand, compared to Estonia and Latvia.

See Also:   Estonia, Latvia, Lithuania, Marc Da-Silva, Overseas property investor news