Investment Guides: Lithuania

Lithuania is suffering from the world economic crisis! This is very notable in the Real Estate (REs) market. When the supply exceeds demand is a very favorable situation to invest.Analysts assume that the year 2009 is going to be the worst in terms of crisis in Lithuania. Nevertheless the REs prices one day are going to go up. The main thing for the investors is to find the moment when the prices are lowest and using all possible tools during the moment of buying to lower theme even more.Loan portfolio status in Lithuania became clear only on June the 1^st  2009.  From that date is possible to forecast an investment confidence growth.Until 2013-2015 Lithuania will get the EU support, which is one more argument for taking it seriously as a potential investment zone. 

In Lithuania the most populated area and the largest amount of investments are in the area of the capital Vilnius. Lithuania also has the most western non-freezing port in Baltic sea – Klaipeda. In this region also there is the biggest concentration of  seaside tourism places like Nida, Palanga, Šventoji. The second city in Lithuania according the population is Kaunas. These are the main zones where you can expect a profitable investment in Lithuania. Part of supply of REs today comes from banks. Because of inability of credit takers to pay back loans banks even thou without great enthusiasm have gain a significant part of REs that now is in the market. This fact can lead into two things: Banks by willing to gain more liquidity fast, will influence drop of prices of REs (by the forecast of June the prices of REs will drop by 15-20% in Lithuania). It will be very favorable time for those who take loans to buy REs that is a property of the bank were the loan is given.

During the period of crisis there can be no rush in making an investment, because it is a process that looks more like a marathon tan a sprint. The winners are not those who burn the energy – the finances, in the beginning, but the ones that select the correct strategy, the ones that listen to analysis and forecasts of the experts. Even negotiation of a price is more effective during the period of crisis. Few suggestions for the investors:

Invest in to REs funds, because they will be the ones that shall react fast to the recovery of the economy. Invest in projects that are oriented towards ecology. The preservation of nature and pollution lowering are most likely to be the priorities in the future. Buy or hold the land for block-house, office, hotel and house constructing. But do not forget, you will probably will have to hold it for some time. Buy flats in block-houses that are of not very good condition if they are in well urbanized areas that have good communication. Aim for the zones that are close to shopping centers and drugstores.

It is forecasted that the commercial land market will recover much faster than the land for living market. The construction firms will have to sell unfinished projects at very low price jus not to go bankrupt. The observation of the market, consulting with good specialists and patience – are key factors that will help in finding the best investments. Remember that the marathon is not won by the fastest, but by the most patient and wise runner. The recovery of international financial markets and global warming in investing climate may be forecasted in 2009. All though new obstacles await Lithuania in the beginning of 2010 after closing the Ignalina atomic power-plant. The comeback into the positive faze of growth is forecasted in year 2011 though it is not very likely that Lithuania will reach the potential growth level (4%).