Wednesday, August 22, 2007

Latvian housing market: the current state

An increasing number of people are coming to this blog via google, searching for "Latvian housing crisis" or something like that.

I would not call it a crisis (not yet, though it could become one in the future) but here is the current situation. After rising more than 60% in year until April 2007, the Latvian housing prices have dropped 8% since then. The number of "For rent" ads has been steadily increasing, as sellers choose to wait and rent out the apartments instead.

Diena newspaper has two blogs: one by a journalist who is trying to sell his apartment and another by a person who is trying to rent a place. Both of them are having difficulties. If we believe the blog comments, the rental apartments get rented out quickly, often for a price roughly equal to a mortgage payment when buying a similar place at the current prices. So, there are people who could make the mortgage payments... but they chose to wait with buying or (most likely) don't qualify for mortgage under the new stricter bank requirements.

Banks have been a big part of both rise and fall in the housing prices. Since April, the amount of money issued in new mortgages has declined. By now, managers of all 4 biggest Nordic owned banks have admitted that they are deliberately cutting back on new loans, because of the concerns about severe overheating in the Latvian economy. Hansabanka (owned by Swedbank) who is by far the biggest lender in Latvia has cut back the most.

There are claims that the smaller locally owned banks are expanding their lending and giving loans to people who are turned down by big banks. I have no data on that but the press releases from Latvian association of banks show decline in total lending by all banks combined. So, even if smaller banks are increasing their lending, the increase is not big enough to compensate for cutbanks by Hansabanka etc. And if this happens to be a mirror image of what happened before the prices peaked. It was the local banks who had the stricter standards then, while Hansabanka&Co were increasing their market share with easier loans.

I've been wondering for a while if cheaper credits from abroad would somehow find their way into Latvian credit market, defeating the cutbacks by Hansabanka&Co. This has not happened on a large scale yet and, given the overall situation in world financial markets, is becoming less and less likely.


Anonymous said...

Do You interesting of [b]Female use of Viagra[/b]? You can find below...
[size=10]>>>[url=][b]Female use of Viagra[/b][/url]<<<[/size]

[b]Bonus Policy[/b]
Order 3 or more products and get free Regular Airmail shipping!
Free Regular Airmail shipping for orders starting with $200.00!

Free insurance (guaranteed reshipment if delivery failed) for orders starting with $300.00!

Generic Viagra (sildenafil citrate; brand names include: Aphrodil / Edegra / Erasmo / Penegra / Revatio / Supra / Zwagra) is an effective treatment for erectile dysfunction regardless of the cause or duration of the problem or the age of the patient.
Sildenafil Citrate is the active ingredient used to treat erectile dysfunction (impotence) in men. It can help men who have erectile dysfunction get and sustain an erection when they are sexually excited.
Generic Viagra is manufactured in accordance with World Health Organization standards and guidelines (WHO-GMP). Also you can find on our sites.
Generic [url=]Viagra 100mg pills[/url] is made with thorough reverse engineering for the sildenafil citrate molecule - a totally different process of making sildenafil and its reaction. That is why it takes effect in 15 minutes compared to other drugs which take 30-40 minutes to take effect.
[b]Viagra Soft Tabs Review
walmart generic drug
order forms for buying viagra
myonlinemeds biz nexium renova vaniqa viagra
viagra online shop
viagra professional canada
viagra heart racing
Even in the most sexually liberated and self-satisfied of nations, many people still yearn to burn more, to feel ready for bedding no matter what the clock says and to desire their partner of 23 years as much as they did when their love was brand new.
The market is saturated with books on how to revive a flagging libido or spice up monotonous sex, and sex therapists say “lack of desire” is one of the most common complaints they hear from patients, particularly women.

viagra online said...

Congratulation you did a great work with this post about Latvian housing market: the current state I'm very interesting in this post and I would like to have any update about it. thanks for sharing!!! I really appreciate your information

Green Parks said...

Hello.. Firstly I would like to send greetings to all readers. After this, I recognize the content so interesting about this article. For me personally I liked all the information. I would like to know of cases like this more often. In my personal experience I might mention a book called Green Parks Costa Rica in this book that I mentioned have very interesting topics, and also you have much to do with the main theme of this article.

Anonymous said...

Buy Priligy Dapoxetine Premature Ejaculation 30mg
Buy Priligy Online In United Kingdom
Priligy Dapoxetine Canada
Cheapest Priligy Online In The Uk
Priligy Dapoxetine Side Effects Online Premature Ejaculation
Buy Priligy In Czech Republic
Cheapest Priligy Online In Glendale