Opening page: Ausros Vartai, Gate of Dawn in the Lithuanian capital Vilnius
Lithuania
! ONE TO WATCH
Left: the national folk dance is still performed
LIFE IS GOOD IN
Lithuania
Clockwise from right: decorative style hints at the country’s previous soviet links; the statue of Jesus stands on the Hill of Crosses at Siauliai; good fit – Lithuanian nesting dolls; the Cathedral of the Theotokos, Vilnius
AT LESS THAN THREE HOURS FROM GATWICK, THIS BRIT-FRIENDLY BALTIC STATE IS DRAWING UK TOURISTS. AND NOW WE’RE BUYING THERE TOO, ATTRACTED BY THE CULTURE – AND LOW-COST HOMES WORDS CHRISTOPHER NYE PICTURES GETTY, PICTURES COLOUR LIBRARY
W
hen the Iron Curtain came down 18 years ago, few of us guessed at the riches hidden behind it. The three Baltic nations, Estonia, Latvia and Lithuania, had simply been lumped in with the Soviet Union, fixed in most British minds as a vast land of soulless bureaucracy, grim Stalinist architecture and vodkasoaked peasants queuing for spuds. However, when tourists started arriving in Lithuania in the 1990s, they discovered beautiful medieval cities with cobbled streets and fairytale castles. They found beautiful, blonde, wine-quaffing locals desperate to free themselves from Russian domination. There were hiccups along the way, notably the Russian economic crisis of 1998 that led to massive unemployment. But that just made them even more keen to become part of the EU, sowing the seeds of today’s economic and cultural revival. For a long time, property prices remained quaintly low. Until a couple of years ago, you could buy a perfectly decent, 1980s-built apartment in the suburbs of Vilnius for £10,000. But with EU membership, the situation has changed dramatically: “Latvia saw property price rises of 66 per cent last year, Estonia 56 per cent, and Lithuania 33 per cent,” says Charlie Pritchard of overseas investment specialist David Stanley Redfern: “Growth in Lithuania is more
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controlled than in Latvia and Estonia, but looks set to continue.” However, none of that recent success should make investors worry that the boom is over – prices are still astonishingly low by European standards.
Not a mountain in sight A largely flat country of lakes and forests, Lithuania is half the size of England with a population of only 3.5 million. Its capital, Vilnius, is far from the Baltic, 200 kilometres inland near the Polish border. Much of the country’s short coastline is protected by the Corunian Peninsula, a spit of land that creates a huge lagoon, and a popular tourist resort. Most Brits, however, tend to restrict their property search to the capital. Vilnius has a population of more than half a million, and in the Middle Ages was the centre of an empire nearly 20 times the size of modern-day Lithuania. Its narrow streets are winding and cobbled, and its buildings are painted in muted pastel colours – indeed, it’s often described as being Mediterranean in ambience. You can cover the entire capital on foot, and it is perfect for weekend breaks, at just under three hours’ flying time from the UK. In 2006, ten per cent of all visitors flying in were British, a percentage surpassed only by the Germans. But the Brits spent more, and despite being a popular venue for British stag parties, the Lithuanians seem to like
THE BUYING PROCESS What you need to know £ Protected by EU law, the buying process in Lithuania is comparatively straightforward. However, it will require at least one trip to Lithuania to go before the notary. £ Once the price is agreed and the deposit is paid, withdrawing from the purchase will mean you lose your down payment. If the seller pulls out, though, they must repay double the deposit – ouch! £ Purchase costs are relatively low. You’ll have to pay around £500 in legal fees, plus one per cent of the purchase price for the notary and three per cent to the agent (though this will usually be already included in the price if using a British-based estate agent). There is a flat rate of income tax, with rental income and capital gains tax at 15 per cent. There is no stamp duty in Lithuania. £ On selling, there is no capital gains tax if sold after three years, but 15 per cent if sold within three. Lithuanian banks will loan to foreigners resident outside the country at up to 90 per cent LTV.
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