Fall has brought surprises to the home rental market: it sees a new trend and price changes

Students don’t see the impact, but another trend is emerging

September was like a breath of fresh air for real estate developers. The statistics collected show that the first month of autumn was a record month: Lithuanians did not skimp on money and actively bought real estate. It was autumn, according to real estate analysts, which was the time for the housing market to recover. High hopes were also pinned in September in terms of the rental market. Fall is a time when new students flock to the big cities each year, those who allowed their parents to visit the regions in the summer return. They are looking for a place to live and often choose to rent a room or an apartment.

But this year has been exceptional. According to Marius Čiulada, director of the Old Town office of the real estate company Ober-Haus, this year there was no sudden influx of students.

“The fact that, for example, the rental phones have been silent since mid-August has not been such a big blow. Perhaps that search for housing has been extended in a few months, someone has come before, someone has come later, it can be said that we have not seen such a significant activation as before, ”says the real estate expert.

On the other hand, according to M. Čiulada, for several years there has been a decrease in first-year students in large cities, so this year is no exception.

“Every year, the number of first-year students in big cities is decreasing. You don’t notice much, but statistics show that the figures are changing little by little,” says the interlocutor.

However, the real estate expert highlights that the situation in the rental market is not bad. According to him, this fall presented another surprise: foreigners who have come to Lithuania to work and live or who plan to come to Lithuania are increasingly interested in renting apartments in big cities. According to Chulada, several inquiries about the rental of housing are received from the population of Belarus.

“The rental market is not too bad, it was active enough without students. It should be noted that the apartments are not actually empty, there are tenants and no students. We get questions about hiring from other countries, such as construction workers and the Eastern transport. Our company currently takes care of 25 families from Belarus who are looking for housing. We even see if we have something to offer them according to their needs “, assures the interlocutor.

We return to the level that was before the quarantine

Arnoldas Antanavičius, director of real estate, real estate analyst Arnoldas Antanavičius, says that the situation in the rental market has really improved. According to him, the analysis of real estate rental advertisements shows that the number of housing rental offers has actually decreased, during the quarantine and immediately after the rental offer was much higher.

“If we look at the number of empty apartments, they are practically the same as before the quarantine. Of course, the second wave of coronavirus is before our eyes, but so far it seems that the rental market has returned to normal, old cancers, “said the real estate analyst.

A. Antanavičius also claims to notice a more active interest from foreigners, especially Belarusians, in real estate in Lithuania, as well as in housing rental opportunities. He attributes this to the country’s growing investment appeal.

“Belarusians are more active, they seek opportunities in Lithuania to invest, create businesses, develop projects or relocate activities. Therefore, I would not rule out that part of the rental market could have been” eaten up “by increased traffic from a neighboring country. If companies are started, employees will have to live somewhere, so it can also be a positive change for the rental market, “explains the real estate expert.

Rental prices have risen again

Although now the rental market seems to have returned to its old cancer, even a few months ago housing was easier and cheaper to rent. Tomas Sovijus Kvainickas, Head of Investments and Analysis at Inreal, explains that, comparing the first and second quarters of this year, the average rental price of 1-3 rooms in Vilnius fell from 11 Eur / m2 to 10.5 Eur / m2 , that is, it decreased by about 5-10 percent. In the Old Town, rental prices fell further due to the significant influx of short-term rental housing on the market. In sleeping areas, the negative price change was smaller, more pronounced changes were registered in the houses of smaller areas. The second quarter was difficult for all sectors of the economy.

“The owners of the apartment and rental business did not know how the situation would develop, so they often decided to lower prices slightly to retain or attract new tenants, be more competitive in the market and avoid vacancies. It can be said that the second quarter was a “tenant market”, conducive to negotiations on a lower rental price and the migration to better homes for a lower price ”, explains the real estate analyst.

The interviewee continues that looking at the figures for the third quarter, it can be seen that the average rental price per square meter has returned to the level of the first quarter, and the total price – about 500 euros – even slightly exceeded the prices of the beginning of the year.

“The rental market is seasonal, and the third quarter is generally the busiest year as students come to study places, and this is when most of the long-term deals are made, so the owners have gained a better leverage in the negotiations again in the middle of the summer, “says Kvainickas.

Among other things, he is convinced that students have nonetheless revived the real estate rental market like every year.

According to M. Čiulada, office manager at Ober-Haus Old Town, you can currently rent a good-value apartment in 2-3 weeks or even earlier. As the heating season approaches, according to the interlocutor, the owners still tend to negotiate the rental price of the apartment: it is better to rent a cheaper house than to pay for utilities themselves.