Lithuania's Residential Real Estate Market Analysis 2026

Lithuania's housing boom has gathered pace since our previous edition. Apartment prices in the five largest cities are now rising by almost 14% a year, the fastest pace since early 2023, and price growth has spread from Vilnius to the regional cities. At the same time, the number of apartment sales has levelled off, mortgage rates have started to rise again as the European Central Bank (ECB) tightens policy, and inflation has climbed above 6%.

This extended overview from Global Property Guide covers key aspects of the Lithuanian housing market and takes a closer look at its most recent developments and long-term trends.

Table of Contents

• Property Prices and Price Index
• Property Demand Trends
• Property Supply Trends
• Rental Market: Rents and Rental Yields
• Mortgage Market and Interest Rates
• Economic and Social Factors

Property Prices and Price Index

Apartment prices in Lithuania's five largest cities rose by 13.7% in the year to September 2026, according to the Ober-Haus Lithuanian Apartment Price Index (OHBI), published by real estate company Ober-Haus. In September alone, prices rose by 1.2%. A year earlier, in August 2025, annual growth was 8.2%. Adjusted for inflation, apartment prices rose by about 7.1% year-on-year.

Lithuania's house price annual change:

Price growth has kept accelerating through 2026. Since December 2025, the index has risen by 10.6%, based on GPG calculations from Ober-Haus's published index values. In 2025 as a whole, the index rose by 11.3%, the strongest annual increase since 2022.

All five cities recorded strong growth, but the fastest increases are now outside the capital:

• In Panevėžys, prices rose by 17.5% year-on-year to an average of EUR 1,432 (USD 1,605) per square meter.
• In Šiauliai, prices rose by 17.3% to EUR 1,457 (USD 1,633) per square meter.
• In Kaunas, prices rose by 16.8% to EUR 2,339 (USD 2,621) per square meter.
• In Klaipėda, prices rose by 12.9% to EUR 2,103 (USD 2,356) per square meter.
• In Vilnius, prices rose by 12.2% to EUR 3,197 (USD 3,582) per square meter.

The cheapest homes are rising fastest. "This segment remains the most active part of the housing market, with prices rising considerably faster than those of more expensive or higher-quality properties," said Raimondas Reginis, Head of Market Research for the Baltics at Ober-Haus. In the third quarter of 2026, buyers paid an average of EUR 133,000 for an older two-room apartment in the most popular districts of Vilnius, up from EUR 113,000 a year earlier. In Kaunas, the price of such apartments rose from EUR 88,000 to EUR 110,000, and in Klaipėda from EUR 78,000 to EUR 97,000.

Official data tell the same story. Lithuania's house price index, which covers all dwellings nationwide, rose by 14.3% year-on-year in Q2 2026 and by 5.0% quarter-on-quarter, according to Eurostat. That was the third-fastest annual increase in the European Union, after Portugal and Bulgaria, and the fastest quarterly increase.

The Bank of Lithuania's repeat-sales house price index, which tracks dwellings sold at least twice, rose by 16.1% year-on-year in June 2026, up from 7.8% a year earlier, with prices up 24.3% in Kaunas and 14.0% in Vilnius. The latest months are provisional and may be revised.

The central bank is concerned about affordability. "Annual house price growth exceeds 15%, so prices are rising roughly twice as fast as household earnings," the Bank of Lithuania said in October 2026. Average take-home pay rose by 9% over the same period.

New-build prices

In the primary market, the median asking price for new homes in Vilnius rose by 8.5% during 2025 to EUR 3,600 (USD 4,034) per square meter, according to real estate group Inreal. Economy-class prices rose fastest, by 12.9%, to around EUR 3,471 (USD 3,889) per square meter. In Kaunas, the median asking price rose by 7.9% to EUR 2,950 per square meter, and in Klaipėda by 27.2% to EUR 2,795 (USD 3,132), partly because more cheaper units came onto the market.

New-build prices have kept rising in 2026. In June 2026, the average price of new apartments sold in Vilnius was EUR 4,092 (USD 4,585) per square meter, according to developer Hanner.

Historic perspective

Lithuania's housing market went through a severe boom and bust. Apartment prices in the five largest cities more than doubled between 2004 and 2007, then fell by about 41% between their peak in December 2007 and January 2013, according to the Ober-Haus index. Prices then recovered slowly for a decade.

A second surge followed during the pandemic. Prices rose by 22.4% in 2021 and 19.1% in 2022, before rising interest rates slowed growth to 1.7% in 2023 and 3.6% in 2024. Since then, prices have accelerated again. In September 2026, the index was 50.6% above its 2007 peak in nominal terms.

Property Demand Trends

Apartment sales have levelled off

After a strong 2025, the number of home sales has stopped growing in the big cities. In the first nine months of 2026, about 28,000 apartment sales were registered in Lithuania, only 2.4% more than a year earlier, according to the State Enterprise Centre of Registers (Registrų centras). Sales of individual houses rose by 9.8% to about 10,400.

By city, apartment sales in the first nine months rose by 3.8% in Vilnius to about 10,000, by 0.2% in Kaunas to 3,700 and by 0.7% in Klaipėda to 2,300. In September alone, apartment sales were 7.6% higher than a year earlier.

The Bank of Lithuania said that housing transactions in summer 2026 were 7% higher than a year earlier and 15% above the long-term seasonal average. But activity is now concentrated in the regions, mostly in houses bought without a loan. In Vilnius, Kaunas and Klaipėda, sales rose by just 2% year-on-year, compared with 10% in the rest of the country.

Investors and companies are driving big-city demand

In the big cities, growth in Q2 2026 came almost entirely from investment purchases, according to the central bank. Purchases by companies rose by about 15% a year. Only 20% of company purchases involve a loan, compared with 40% for individual investors, so they are less affected by higher interest rates.

Pension withdrawals and easier down payments

Two policy changes are supporting demand in 2026. This year, Lithuanians have been able to withdraw savings from second-pillar pension funds, and Ober-Haus expects some of the returned money to flow into the housing market. The Bank of Lithuania said that withdrawals boosted household spending from March, but that households have spent only part of the money.

And since 1 August 2026, first-time buyers can borrow up to 90% of a property's value, meaning a minimum down payment of 10% instead of 15%, if they have not owned property in the last five years. The Bank of Lithuania estimated that its package of lending-rule changes could make house prices up to 1.6% higher over three years than they would otherwise be, according to its notification to the European Systemic Risk Board.

Property Supply Trends

A construction wave is on its way

New housing supply is expanding quickly. The number of apartments granted building permits in Q2 2026 was the highest in 15 years, both in Vilnius and in the rest of the country, the Bank of Lithuania said. In September 2026, about 10,000 new homes were on offer in the primary markets of the big cities, 30% more than a year earlier, the central bank estimated.

Most of these homes are not yet built. Historically, a surge in development turns into completed homes five to seven quarters later, and the central bank expects the biggest increase in completed supply in the summer and autumn of 2027. "Record numbers of building permits should significantly increase housing supply in 2027 and dampen further price growth," it said.

Permits are concentrated where prices are highest. In 37 of Lithuania's 60 municipalities, no permits to build apartments have been issued in recent years.

Vilnius new-build sales almost doubled in 2025

Demand for new homes outran supply in 2025. In Vilnius, sales and reservations of new homes rose by 83.6% to 6,025, while 5,973 new units came onto the market, up 32.6%, according to Inreal. Unsold supply fell by 7.4% to 4,200 units by the end of the year, and the share of completed homes in that supply fell from 27.2% to 10.2%.

Sales have stayed strong in 2026. In the first half of the year, 3,342 new apartments were sold in Vilnius, 16% more than a year earlier, according to Hanner. In June, buyers could choose from 5,562 new apartments in the capital, 23% more than at the start of the year.

Rental Market: Rents and Rental Yields

Rents are rising faster again

Rent inflation has picked up in 2026. Actual rents for housing rose by 8.5% year-on-year in August 2026, up from 3.3% in March 2026 and 5.0% in August 2025, based on GPG calculations from the harmonised index of consumer prices published by Eurostat.

Lithuania's rent price index:

Even so, rents have risen more slowly than house prices over the long term. Since 2015, rents have risen half as fast as sale prices, the Bank of Lithuania said, which makes renting relatively attractive.

In 2025, market rents rose by around 3% in Vilnius, 4.5% in Kaunas and 2.6% in Klaipėda, according to Inreal:

• In Vilnius, median rents were EUR 400 to EUR 450 (USD 448 to USD 504) a month for one-room apartments, EUR 620 to EUR 650 (USD 695 to USD 728) for two-room apartments and EUR 800 to EUR 850 (USD 896 to USD 952) for three-room apartments.
• In Kaunas, peak-season rents for two-room apartments rose by 6% to EUR 530 (USD 594) a month, and for three-room apartments by 8.3% to EUR 650 (USD 728).
• In Klaipėda, median rents for two-room apartments were EUR 470 to EUR 500 (USD 527 to USD 560) a month.

Rental yields have fallen

Because prices have risen faster than rents, yields have fallen. Gross rental yields on apartments in Lithuania averaged 5.54% in Q2 2026, down from 5.87% in Q4 2025 and 6.29% in May 2025, according to research by Global Property Guide.

Yields are highest in the smaller cities. In Šiauliai, the average gross rental yield was 6.10%, followed by Klaipėda at 5.64% and Kaunas at 5.56%. Vilnius had the lowest yield, at 4.86%.

Mortgage Market and Interest Rates

Interest rates are rising again

Lithuania uses the euro, so its interest rates follow the ECB. After eight cuts between June 2024 and June 2025, which brought its deposit facility rate to 2.00%, the ECB raised rates in June 2026, for the first time since 2023, and again in September. Since 16 September 2026, the deposit facility rate has been 2.50%, the main refinancing operations rate 2.65% and the marginal lending facility rate 2.90%, according to the ECB.

Lithuania's mortgage loan interest rates:

"The conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period," ECB President Christine Lagarde said in September. ECB staff expect euro area inflation to average 3.0% in 2026 and 2.5% in 2027. The next ECB decision is due on 29 October 2026.

Most Lithuanian mortgages have variable rates linked to the six-month Euribor. In September 2026, the six-month Euribor reached about 3%, almost one percentage point higher than at the start of the year, and the monthly payment for new borrowers rose by more than EUR 50 (USD 56), or about 10%, over the same period, the Bank of Lithuania said.

Mortgage rates have followed. The average interest rate on new housing loans was 4.16% in August 2026, up 0.06 percentage points from July, according to the Bank of Lithuania. In May 2025, the average was 3.93%, and at the end of 2023 it had reached 5.9%, the central bank said.

Housing loans are growing fast

Mortgage lending is booming. Outstanding housing loans to households reached EUR 16.5 billion (USD 18.5 billion) at the end of August 2026, up 14.1% from a year earlier, according to the Bank of Lithuania. In August alone, the stock grew by EUR 196.0 million. Growth in the housing loan portfolio in June was the second-highest in the euro area, the central bank said.

Borrowing rules

Under the Bank of Lithuania's revised responsible lending rules, in force since 1 August 2026, first-time buyers need a down payment of at least 10%. For a second or later home, the minimum down payment remains 30%, or 15% if more than half of each existing loan has been repaid. The previous two-part limit on loan payments has been replaced by a single cap: payments may not exceed 50% of the borrower's income, tested at an interest rate of at least 6%, according to the central bank's notification.

Economic and Social Factors

Growth continues, but inflation has jumped

In September 2026, the Bank of Lithuania forecast growth of 2.7% in 2026, 2.4% in 2027 and 3.1% in 2028. Pension withdrawals boosted consumption in 2026, but the central bank expects that effect to fade and even turn negative in 2027.

Inflation has risen sharply. Harmonised consumer price inflation reached 6.1% in September 2026, up from 3.7% a year earlier, based on Eurostat data. The main driver is energy: energy prices were about a fifth higher than a year earlier, and heating costs rose by more than 40%, partly because a reduced VAT rate on district heating and firewood was abolished. The Bank of Lithuania expects inflation to average 5.1% in 2026, before easing to 3.1% in 2027 and 2.6% in 2028.

Labor market

The labor market remains tight. The unemployment rate was 6.8% in the first half of 2026, about 0.3 percentage points below the average of the previous six years, according to the Bank of Lithuania. Private-sector pay has been rising by about 8.9% a year for around two years, and the central bank expects wages to rise by 9.4% in 2026.

Labor shortages are made worse by demographics. Net immigration, which supported the labor force after 2022, has slowed from 72,100 people in 2022 to 16,800 in 2025, according to the Bank of Lithuania.

Credit ratings and politics

Credit ratings remain strong. In April 2026, Fitch Ratings upgraded Lithuania from A to A+ with a stable outlook, its first upgrade in six years. Moody's affirmed its A2 rating in April, S&P Global Ratings its A rating in May, and Morningstar DBRS its A (high) rating in October 2026, all with stable outlooks, according to the Ministry of Finance.

Politics has been turbulent. The government led by Inga Ruginienė, which took office in September 2025, resigned on 23 June 2026. The new prime minister is Social Democratic leader Mindaugas Sinkevičius, previously mayor of the Jonava district.

Sources:

1. Ober-Haus
   1. Lithuanian Apartment Price Index (OHBI): ober-haus.lt
   2. Buyers Are Paying EUR 20,000 More for Standard Apartments than a Year Ago (September 2026 OHBI): ober-haus.com
   3. The Housing Market Is Showing the First Signs of Stabilization (March 2026 OHBI): ober-haus.lt
2. Bank of Lithuania (Lietuvos bankas)
   1. House Price Growth Is Not Slowing, but a Construction Wave May Slow It (LT): lb.lt
   2. Repeat Sales House Price Index: lb.lt
   3. Monetary Financial Institutions Statistics, August 2026 (LT): lb.lt
   4. Lending Remained Strong in the Second Quarter (LT): lb.lt
   5. Macroeconomic Projections, September 2026 (LT): lb.lt
3. European Systemic Risk Board
   1. Bank of Lithuania Notification of Borrower-Based Measures, October 2025: esrb.europa.eu
4. Eurostat
   1. Housing Price Statistics, House Price Index: ec.europa.eu
   2. HICP, Monthly Data (Index): ec.europa.eu
5. European Central Bank (ECB)
   1. Key ECB Interest Rates: ecb.europa.eu
   2. Monetary Policy Statement, 10 September 2026: ecb.europa.eu
   3. Euro Foreign Exchange Reference Rates: ecb.europa.eu
6. State Enterprise Centre of Registers (Registrų centras)
   1. News and Articles, Including "Autumn Begins with an Abundant Real Estate Harvest", 6 October 2026 (LT): registrucentras.lt
7. Government of the Republic of Lithuania
   1. The Twentieth Government: lrv.lt
   2. Prime Minister's CV: lrv.lt
8. Ministry of Finance of the Republic of Lithuania
   1. Morningstar DBRS Affirms Lithuania's Credit Rating and Outlook: finmin.lrv.lt
9. Inreal
   1. Lithuanian Economic and Real Estate Market Report 2025-2026: inreal.lt
10. Hanner
    1. Vilnius New-Build Sales in the First Half of 2026 (LT): hanner.lt
11. Global Property Guide
    1. Gross Rental Yields in Lithuania: globalpropertyguide.com