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Little known to most Westerners prior to the fall of Communism, the Baltic States each have a proud history dating back several centuries. Their capital cities are listed as UNESCO World Heritage sites: Vilnius is a maze of Gothic, Renaissance and Baroque architecture; Riga has sublime Art Nouveau buildings, which escaped the worst of the Soviet era’s ravages and philistinism.
Today, the cities’ attractive medieval centres are the main tourism drivers that are helping to boost their respective economies, making them amongst Europe’s fastest growing. In the last 12 months year on year, each nations GDP per capita – the benchmark by which economists measure a country’s growing prosperity – increased by the greatest margin amongst the EU 25 member nations, recording an average of almost 10% growth – the EU25 increase was only 1.6% by comparison.
A chief factor behind the countries’ growing prosperity has been the opening up of their property markets to foreign buyers. The increased demand since EU accession has seen house prices rocket as Ben Mason of agents Someplace Else, who market properties in Latvia, notes. “Prices in Riga increased by around 30% in 2005, but the market still represents good value in comparison to other European capital cities,” he says.
“The large scale re-development plans for Riga has provided a great boost to the city as a whole, with increased foreign business and trade, as well as property investment.
“Since major plans for the re-development of Riga were launched last winter, certain areas are attracting more interest from investors looking for solid, long-term growth. A new bridge is being built across the river in Riga, and the old port area is being completely re-developed, similar to parts of Liverpool or the London docklands. An apartment in the Daugagrivas development, which is a converted warehouse in the area, offers great investment potential.”
Similar opportunities can be taken advantage of in Tallinn, Estonia, arguably the most attractive of the three capital cities thanks to its beautiful medieval quarter that has seen it heralded as ‘the new Prague’. Property prices are a little cheaper than in Riga per square metre; a renovated and modernised one-bedroom apartment in Tallinn’s old town will cost in the region of £60,000. A modern apartment on the city outskirts can be picked up for around £35,000, up from £26,000 a little over 12 months ago.
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Located in a desirable part of Tallinn’s old town in the heart of the city, this one-bedroom apartment has been sympathetically renovated and modernised in a building that dates from the 17th century. Sold freehold, the price is £63,100 through IMOINVEST www.imoinvest.com
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