Authored by the expert who managed and guided the team behind the Lithuania Property Pack
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What is happening in Vilnius’s real estate market? Are prices going up or down? Is Vilnius still a hotspot for foreign investors? How is Lithuania’s government impacting real estate policies and taxes in 2025?
These are the questions everyone is asking us every day—professionals, buyers, and sellers alike, from the Old Town to Žvėrynas and beyond. Perhaps you’re wondering the same thing.
We know this because we stay deeply connected with local professionals and people like you, diving into the Vilnius real estate market every single day. That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market trends and dynamics.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Government incentives for foreign investors will increase international interest in Vilnius real estate
The Lithuanian government's incentives are making Vilnius real estate a hot topic among international investors.
In 2023, Lithuania's Foreign Direct Investment (FDI) hit EUR 29.9 billion, a noticeable jump of 10.2% from 2021. Vilnius is the star of the show, pulling in 73.6% of this FDI, with a whopping 95.2% of the region's FDI pouring into the city. This makes Vilnius a magnet for foreign capital.
Property prices in Vilnius are on the rise, with the apartment price index climbing 9.08% in 2023. This is the first significant year-over-year growth in over two years, signaling a surge in demand. The Lithuanian government sweetens the deal by offering residency permits to property buyers, attracting many from nearby Latvia and Estonia.
Investors from Germany, Estonia, and Sweden are flocking to Vilnius, drawn by its lively vibe and strategic location. This influx is fueling the real estate market's growth. The city is buzzing with international flair, evident in its bustling streets and the mix of languages heard in local cafes.
Vilnius is transforming into a global business hub, catching the eye of international players. The city's vibrant atmosphere and strategic position make it a prime spot for investment. The Lithuanian government's initiatives are clearly paying off, as seen in the growing international interest.
Sources: Stat.gov.lt, Statista, Made in Vilnius
2) Vilnius will attract more foreign buyers with its rising status as a tech hub
Vilnius has become a hotspot for tech startups, with 890 companies thriving in areas like Fintech, ICT, and Game Development. In 2023, the city attracted EUR 281 million in investments, showcasing its rapid growth and appeal to investors.
The increase in foreign direct investment in Vilnius's tech sector is noteworthy. By 2023, Lithuania reached its highest recorded FDI, thanks to a business-friendly environment, open data policies, and low income tax, making it an attractive destination for tech entrepreneurs.
International tech conferences, such as DevOps Pro Europe 2024 and DevDays Europe 2024, have put Vilnius on the global tech map. These events draw participants from around the world, highlighting the city's vibrant tech scene.
Media coverage has played a significant role in promoting Vilnius as an emerging tech hub. Articles have detailed the city's strategic initiatives and successful startup ecosystem, further boosting its reputation.
Sources: Startup Lithuania, China-CEE, Eventyco
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Lithuania. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
3) Vilnius property prices will rise moderately due to limited housing supply
Vilnius is experiencing a steady rise in property prices.
In October 2024, the average price for apartments in Vilnius increased by 0.21%, reaching €3,392 per square meter. This is part of a larger trend, with prices having risen by 2.79% since the start of the year and by 3.89% compared to the previous October. The limited supply of new housing is a key factor driving this increase.
In 2023, developers built 4,915 apartments, which was 18% more than in 2022. However, 2024 saw a significant slowdown, with only about 2,900 apartments expected to be built, marking a 41% decrease from the previous year. This drop in new housing projects has contributed to the imbalance between supply and demand.
The demand for housing in Vilnius remains strong, with the rental market showing a gross rental yield of 5.65%. This indicates high demand and low vacancy rates, leading to increased competition in the housing market.
With fewer new developments and a robust rental market, the competition for available properties is fierce. This dynamic is pushing prices up, as more people are vying for the limited number of homes available.
Sources: Ober-Haus, Global Property Guide, Lrytas
4) Mid-range property market will stabilize as supply aligns with demand
In 2023, Vilnius experienced a boom in housing with 4,915 new apartments hitting the market.
This surge, an increase of 750 units from the previous year, shows a strong supply of mid-range properties. Real estate agencies like Ober-Haus expect this influx to balance the market as supply meets demand.
Looking ahead, construction is set to slow in 2024 with around 2,900 apartments planned for sale. This still represents a healthy supply, indicating that developers are adjusting to the market's needs.
In Lithuania, the number of building permits rose to 1,406 units in the third quarter of 2024, highlighting ongoing development. This suggests developers are confident in stable consumer interest in mid-range properties.
Home prices are expected to stay mostly flat through 2024 and 2025, signaling reduced price volatility in the mid-range market. This stability points to a market moving towards equilibrium.
With these trends, the market for mid-range properties is likely to stabilize as supply meets demand.
Sources: Statista, Trading Economics, Norada Real Estate, Ober-Haus
5) Rental yields in central Vilnius will grow with rising demand for city-center living
Rental yields in central Vilnius are set to increase as more people are drawn to city-center living. This trend is supported by the rising rental prices, which saw a significant surge of 26.7% in 2022. Such an increase indicates a strong demand for rental properties, naturally boosting rental yields.
The population of Vilnius and its metropolitan area has been steadily growing, with more people moving to the city each year. This growth is largely driven by urbanization trends, where by 2023, 68.4% of Lithuanians were living in cities and towns. Younger people are particularly attracted to urban areas for job opportunities and a vibrant lifestyle, pushing up property prices in cities.
Higher occupancy rates in central Vilnius properties are another factor contributing to increased rental yields. The influx of young professionals and expatriates is leading to higher demand for rentals, which in turn drives up rental prices. Additionally, the development of new amenities and infrastructure in the city is making central areas more attractive to residents.
Sources: Global Property Guide, LRT, Topos Magazine
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6) Vilnius will remain a safe and profitable market for investors from neighboring countries
Investors from neighboring countries will continue to see Vilnius as a safe and profitable market due to several compelling reasons.
Firstly, the rising property prices in Vilnius compared to other European capitals make it an attractive investment opportunity. This trend is supported by increasing rental yields, which offer profitable returns for real estate investors. The stable economic growth in Lithuania, with a forecasted real GDP growth of around +2.5% per year from 2024 to 2026, further enhances the city's appeal.
Additionally, favorable tax policies in Lithuania, including low corporate tax rates, provide incentives for foreign investors. The significant foreign direct investment (FDI) in Vilnius, with the city accounting for 95.2% of the total FDI in the Capital Region, underscores the confidence investors have in the market. Surveys also show high investor confidence, driven by Vilnius's sustainable business environment and convenient infrastructure.
Moreover, Vilnius's low crime rates and high safety indices make it a secure location for investment. Government initiatives to support startups and high-tech industries, along with positive trends in tourism, further contribute to the city's growing reputation as a hub for innovation and entrepreneurship.
Sources: Stat.gov.lt, Allianz Trade, Vilnius Tech Fusion
7) Young professionals will boost demand for modern apartments in central Vilnius
Vilnius is buzzing with tech startups and international companies, especially in fintech.
In 2023, the city saw the birth of over 170 fintech startups, collectively valued at around €1.8 billion. This tech boom is not just about numbers; it's creating a wave of job opportunities that are drawing young professionals to Vilnius.
Universities in Vilnius are bustling with more students than ever, hinting at a growing pool of skilled young people. These educated individuals are on the lookout for modern apartments that offer convenience and a contemporary lifestyle.
With 32% of Vilnius's population aged 15-39, there's a clear influx of young adults. This demographic is keen on urban living, seeking places that offer easy access to amenities and cultural hotspots.
Young professionals are particularly interested in central Vilnius, where modern apartments meet their lifestyle needs. The city's vibrant atmosphere and opportunities make it an attractive place for this demographic.
As Vilnius continues to grow as a tech hub, the demand for contemporary living spaces in the city center is only set to rise, driven by these young professionals.
Sources: Go Vilnius, Euronews
8) New tax incentives for first-time buyers will boost Vilnius's housing market
New tax incentives for first-time buyers are expected to stimulate the Vilnius housing market significantly. In 2024, the economic segment of the housing market in Vilnius saw a notable increase in transactions, with the share rising to 59% from 44% in 2023. This suggests that more first-time buyers are entering the market, likely encouraged by these incentives.
Additionally, property sales statistics in Vilnius have shown a remarkable surge. In October 2024, 386 new apartments and terraced houses were agreed for sale, which is nearly 90% more than the year before last. This increase in sales can be attributed to the tax incentives making home ownership more attractive and affordable for first-time buyers.
Moreover, Citus analysts have predicted that the total number of transactions in Vilnius's primary market in 2024 should surpass the previous year's results by approximately a quarter. This prediction aligns with the expectation that tax incentives will continue to stimulate the market, encouraging more first-time buyers to take the plunge into home ownership.
Sources: Lrytas, Made in Vilnius
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Lithuania versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
9) Environmental regulations will drive the development of energy-efficient homes in Vilnius
Environmental regulations have played a significant role in encouraging the development of more energy-efficient homes in Vilnius. In the past, the Energy Performance of Buildings Directive (EPBD) set ambitious targets for reducing energy consumption in buildings across the EU, including Lithuania. These regulations required that by 2027, all commercial buildings must have a minimum Energy Performance Certificate (EPC) of 'E,' and by 2030, it must be 'D' or better.
In Lithuania, specific initiatives have been implemented to meet these standards. For instance, since 2021, new public buildings have been required to meet the highest energy efficiency standard (A++). Additionally, from November 2024, it became mandatory for wood and organic materials to make up at least 50% of construction materials in newly built public buildings. These measures have set a precedent for energy-efficient construction practices.
Moreover, government incentives have further supported this shift towards energy efficiency. The Lithuanian government, in partnership with the European Investment Bank (EIB), has invested significantly in renovating multi-apartment buildings to improve energy efficiency. This initiative, which involved up to €625 million in funding, aimed to upgrade homes for thousands of families, aligning with the EU's broader goals for energy efficiency.
Sources: EuropaWire, Savills US, Sustainability.gov
10) Suburban rental yields will dip slightly as urban living becomes more popular
Vilnius is growing as more people choose city life over the suburbs.
With a population of 542,000 in 2024, Vilnius is seeing a steady rise in urban dwellers. This shift is largely due to the city's appeal to young professionals and foreign workers, who are drawn to the vibrant urban lifestyle and job opportunities.
The demand for housing in Vilnius is strong, with more people moving to the city. This trend is pushing rental prices higher in urban areas compared to the suburbs, making city living a hot commodity.
Vilnius has invested in its urban infrastructure, enhancing public transport and expanding bicycle networks. These improvements make city life more convenient and attractive, encouraging more people to choose urban living over suburban options.
Media coverage often highlights the benefits of living in Vilnius, from its cultural scene to its modern amenities. This positive portrayal further fuels the desire for urban living, contributing to the ongoing shift away from suburban areas.
As a result, suburban rental yields are expected to decline slightly as the preference for urban living continues to grow.
Sources: World Population Review, Made in Vilnius
11) Suburban property prices may dip slightly as city-center living gains popularity
In recent years, we've seen a noticeable shift in housing preferences, particularly in Vilnius. The demand for suburban properties has been on the decline. Back in 2022, the number of housing transactions in Lithuania dropped significantly, with house sales falling by 25%.
Meanwhile, the city center of Vilnius has become increasingly attractive. By 2023, apartment prices in the city center and Old Town had risen dramatically, nearly 1.5 times more expensive than they were in 2020. This trend is partly driven by younger people who are showing a strong preference for urban living, which is a common observation in urbanization studies.
Moreover, the city center offers a vibrant lifestyle with amenities like fitness centers, dining options, and cultural events. Improved transportation and infrastructure have made city-center living even more appealing. These factors contribute to the growing demand for city-center properties, which in turn affects the suburban market.
Sources: Global Property Guide, Statista, Luxury Living Spot
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12) Short-term rental yields will rise with increased tourism and business travel
In recent years, Vilnius has seen a significant rise in tourist arrivals, with numbers expected to grow by 11% compared to pre-pandemic levels. This increase in visitors naturally boosts the demand for accommodations, including short-term rentals.
The expansion of Vilnius International Airport has played a crucial role in this growth. By increasing its capacity to handle more passengers and introducing new international flight connections, the city has become more accessible to travelers from around the world. This accessibility is a key factor in attracting both tourists and business travelers.
Moreover, government initiatives to promote Vilnius as a prime destination for tourism and business have further fueled this trend. These efforts, combined with the city's rising popularity on travel platforms and social media, have positioned Vilnius as a desirable location for both leisure and business activities.
Sources: Airport Technology, LRT, China-CEE
13) Rental yields will stabilize with more properties entering the market
Vilnius is buzzing with new residential developments, making it an exciting time for potential property buyers.
In 2023, developers in Vilnius built 4,915 new apartments, marking an impressive 18% increase from the previous year. This boom in construction means more rental options are popping up, which is great news for those looking to rent or invest. With more properties available, rental yields are expected to stabilize, offering a more predictable return on investment.
The local government is backing big projects, like Releven's mixed-use development in the CBD. This project is set to add a significant number of new properties to the market, further boosting the supply of rental units. It's a clear sign that Vilnius is committed to expanding its housing market.
Looking ahead, the completion of rental projects on Vytenio and Talino Streets in 2024 will bring nearly 300 new rental units to the city. These additions will join the existing inventory of over 2,100 professionally managed rental units, underscoring the growing supply of rental properties in Vilnius.
For those considering a move or investment in Vilnius, this increase in housing supply is a promising development. With more options available, renters and buyers alike can expect a more balanced market, making it an opportune time to explore the possibilities.
Sources: Property Forum, Ober-Haus, CARNM Realtor
14) Demand for accessible, senior-friendly housing will rise with an aging population
As we look back at the past few years, particularly 2023 and 2024, it's clear that the aging population in Vilnius has been steadily increasing. This trend is evident from the demographic reports showing a significant proportion of elderly residents in the city. For instance, back in 2015, 20% of Vilnius' citizens were already over 60 years old.
The demand for age-appropriate housing has surged, as seen in the senior housing industry's absorption rate, which rose by 40% in the first quarter of 2024 compared to the previous year. This increase highlights the growing need for housing that caters specifically to the needs of older adults.
Moreover, demographic projections for Lithuania indicate that by 2030, the population may shrink, with a significant portion being elderly. This shift underscores the necessity for more senior-friendly housing options to accommodate the increasing number of older residents.
In Vilnius, real estate developments are already responding to this demand. New projects like the Kotrynos Vartai apartment complex are being built with features suitable for older adults, such as private gardens and outdoor spaces. These developments reflect a broader trend towards creating environments that support the aging population.
Sources: WHO Age-Friendly World, NIC MAP Vision, VilNews
We have made this infographic to give you a quick and clear snapshot of the property market in Lithuania. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
15) Žvėrynas property values will rise due to its historic charm and central location
Žvėrynas is a neighborhood in Vilnius known for its historic charm and central location.
People are flocking to Žvėrynas because Vilnius is becoming a tech and cultural hub, attracting both local and international investors. This influx is naturally pushing up property values as more folks want a piece of the action.
Urban development is also making Žvėrynas more appealing. With new eco-friendly projects, schools, and parks, the area is becoming a hotspot for families, which in turn boosts property values.
Media buzz about Žvėrynas highlights its charm and location, making it even more desirable. This attention is like free advertising, drawing more interest and driving up property values.
Investors are pouring money into renovating historic buildings in Žvėrynas, which not only preserves its charm but also increases property value. This makes the area even more attractive to potential buyers.
Žvėrynas is close to business districts and cultural spots, making it a prime location for both living and investing. This proximity is a big reason why property values are on the rise.
New businesses and services are popping up in Žvėrynas, creating a vibrant community. This activity makes the area more appealing, which can drive up property values as more people are drawn to the neighborhood.
Sources: Ober-Haus, YieldPro, Made in Vilnius
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.