February 6, 2014. Vilnius. The RE Market Review of 2013-2014, which was conducted by Inreal Group and the Law Firm SORAINEN and presented at the conference that was held by Lithuanian Real Estate Development Association (LREDA), states that a record-breaking activity has been observed in the land market. The major activity was in the most productive regions of Lithuania. The average annual increase in prices of agricultural land increased by 10-15 percent. The average price of parcels in the most productive regions reached 10,000-15,000 LTL/ha. It is expected that the market of land for construction will be enlivened in 2014 by the territory planning reform, which is the most beneficial to the land managers in cities and other built-up territories.
According to data of SE Centre of Registers, there were 38,281 land purchase-sale transactions registered throughout Lithuania in 2013 – by 18.6 percent more than in 2012. The majority of them were the transactions on agricultural land purchase-sale. The transactions in this segment made up 77 percent of all transactions conducted in 2013.
The capital city was playing the major role in the land market. “The majority of agricultural and residential land transactions were made in Vilnius city - 51 and 35 percent of transactions, respectively,” – stated Arnoldas Antanavičius, the Head of Consultations and Analysis Department of Inreal Valdymas. According to him, this significant hike of agricultural land in Vilnius city may be related to the amended law on territory planning, which entered into force from 2014. The law eliminated the necessity to draw up detailed plans in many cases. As a result “of the recovering RE market in Vilnius, a relatively cheaper agricultural land has become more attractive to investors,” - stated A. Antanavičius.
The fact, that the market of land for construction should be enlivened by the territory planning reform, was also confirmed by Aušra Mudėnaitė, the attorney at law and the partner of the Law Firm SORAINEN. “However, it is possible that the influence of this reform will be different on each segment of the market. Definitely, this reform is the most beneficial to the land managers in cities and other built-up territories. The time from the emergence of the development idea to the construction authorisation issuance, as well as the administrative costs related thereto, will be reduced essentially, because in many cases the process of detailed planning is no longer necessary. However, the developers in non-urbanized areas and suburbs, where urbanization is not anticipated, will not experience any positive changes from this reform. This year the agricultural land market will be influenced by the amendments to the laws, which reduced the maximum area of agricultural land that can be purchased”, – stated the lawyer A. Mudėnaitė.
Review of Lithuanian Economics and Real Estate Market of 2013-2014 is available on the websites www.inreal.lt and www.sorainen.com.
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