The price rage: what has become the most expensive in Lithuania since 1995

Prices doubled

Only after Lithuania regained its independence, as the economist explained, was it possible to see a huge hyperinflation in the country, and prices increased by one hundred percent at that time.

According to him, the most realistic point from which long-term price changes can be compared is 1995, because in 1994 the litas was pegged to the dollar, which then slowed the rise in inflation.

“The price increase since 1995, in general, is not very big, even, I would say, relatively small. If we talk about headline inflation, in Lithuania we have 105 percent. prices have doubled since 1995, ”said Maurice comparing that, for example, in Germany, prices rose by 41% in the same 25 years and in the European Union by 53%.

“And wages in Germany have risen 57% since 1995, so much of the purchasing power has increased.

In Lithuania, this difference is huge, as the median salary has increased almost 9 times and prices have only doubled, which means that purchasing power has increased 4.5 times, “he compared, saying the figures were not surprising. , and added that according to Eurostat, according to 1996 data, the prices of services have increased by 189%.

The most expensive rental housing

Since 1995, according to the Lithuanian Department of Statistics, house prices have risen the most in Lithuania. Their prices have risen 860 percent in 25 years.

“We can say that rents have risen in price by almost the same amount, just a little more than wages have risen.

Salaries since 1995 increased by 778 percent. As for housing, I think the change is normal, because it tends to go up in price as income grows, well, at least lately. This affordability is not increasing, but on the other hand, it can be explained because people are earning higher incomes, the supply is limited, everyone is rushing towards city centers, so the price is increasing. It is appreciated that the rental price of the house does not rise faster than the income.

If we had statistics from the Scandinavian countries, the increase in rents since 1995 would be much higher, ”said the economist, ensuring that he does not see major problems with the sharp rise in house prices.

Second, in terms of rising prices, tobacco products have become more expensive in 25 years. Its price has increased 765 percent since 1995. Third, waste collection, where 762 percent. price increase.

Also, over 25 years, the prices of passenger transport increased 425%, while accommodation services increased 387%.

“From 1995 to 2020, the price of beer increased approximately 2 times and that of ice cream, approximately 3 times.

Taking into account that the wages in the hands have increased almost 9 times (from 105 to 930 Eur), we can buy about 4.5 times more beer and about 3 times more ice cream.

Milk has risen in price slightly since 1996, by 90%, ”Ž said. Mauricas.

Which is the cheapest

Among the cheapest goods are cars, but, as the economist pointed out, although their price has dropped by 52% since 1995, the real price change is probably quite different.

“You can’t compare it here because 25 years ago other cars were bought. I think their price is now 50 percent lower because now not many people buy such.

I think Lithuanians today don’t really spend less money on cars, I can guarantee that. And the cars themselves have become more functional, there are more benefits, because the car is completely different now and 10 years ago. There was an automatic transmission, a computer, wireless systems, so they can’t be compared. And here we compare cars that are technologically similar to those of 25 years ago, which no longer exist and therefore such a drop in price is perceived ”, he explained.

Also, as the data shows, 27 percent. cheap appliances, footwear. Its price fell 17 percent and clothing prices fell 5 percent.

“The first thing is now more competition. But currently clothing in Lithuania still costs more than the EU average, “said Ž. Mauricas.

We live better

Speaking about the general impact that inflation may have had on price increases over the years, the economist said that it was the one that increased the most in 2005-2007.

“Then there was a very big consumer bubble, we were inflating the credit bubble and prices went up very fast.

Subsequently, there were not such large jumps and the rise in prices was more determined by changes in fuel prices, which were also transferred to other goods and services, and from 2014 to 2015. the prices of services began to rise quickly. This change has been significant, but all due to the rapid increase in wages. “It is not so much about the introduction of the euro in 2015, but about wage growth,” he said.

According to Ž. Maurico, people often feel that everything becomes more expensive, but they themselves do not realize that they are buying better quality products and living a better life.

“The composition of the basket is changing not only between different categories of goods, but also within the categories themselves. Let’s say that household appliances, in the past people bought economy class items, but now there are hundreds of stores, Italian brands, etc., and today Lithuanians buy household appliances of the best quality.

In the past, both computers and telephones were used. Now of course it still exists, but newer ones are being bought.
The age of the cars that are bought is also getting younger. This is also felt in food, before there was a doctor’s sausage, and now everything has changed and the range in stores is changing. There are also ecological departments, where the products are more expensive, fresh juice has appeared, which costs almost 2 euros ”, Ž said. Mauricas.

In summary, the economist assured that in general, the growth of prices, compared to the growth of income, was not rapid in Lithuania.

“Prices have risen 105%, so prices have risen only twice. And wages have risen almost nine times. Today, Lithuanians are living better and better. Of course, no one will exactly measure those prices, because many things they are changing, ”he said.