Acquiring a new home is one of the most significant and consequential financial decisions an individual or family will ever make. The process is not merely transactional; it is deeply personal, influencing lifestyle, finances, and long-term well-being. With the real estate market showing dynamic movement and a potential new growth cycle beginning, prospective buyers in many markets, including Lithuania, are actively comparing two major options: purchasing an apartment or buying an individual house. While apartments often remain the most popular choice due to urban convenience and general affordability, the appeal of a standalone home with green space continues to draw active interest.
In this comprehensive, expert-driven guide, we will delve into the critical factors you must evaluate before committing to one type of property. Drawing on insights from real estate experts and banking professionals—like Evaldas Matlauskas, a real estate expert, and Darius Burdaitis, head of the Lithuanian branch of Citadele bank—we will highlight common pitfalls, provide specific, actionable advice, and offer a clear framework for making a rational, long-term decision. The goal is to equip you with the knowledge to navigate this complex choice and ultimately ensure your investment aligns perfectly with your financial capacity, lifestyle needs, and future aspirations.
The Current Market Landscape: A Resurgence of Activity
Understanding the market’s mood is the first step toward a successful purchase. Recent data indicates that the property market is emerging from a period of stagnation, with signs pointing toward the beginning of a new growth cycle. For example, in many regions, the 12-month rolling average for house sales transactions has reached its highest point in nearly a year, and the same metric for apartment sales is also showing strong recovery. This renewed vigour is often attributed to several macroeconomic factors.
As Darius Burdaitis noted, the activity in the real estate sector directly impacts the lending market. A key driver has been the ongoing reduction in base interest rates across the Eurozone and a high level of optimism among consumers, coupled with a swift recovery in purchasing power. Many buyers who held back during periods of historically high-interest rates are now returning to the market, spurred by improving loan conditions. However, despite the increased demand, the market remains competitive among sellers, meaning that while there is ample supply, buyers are more informed than ever. Evaldas Matlauskas emphasizes that today’s buyers are knowledgeable; they are not purchasing the first property they see. This environment allows savvy purchasers the time and opportunity to carefully weigh the pros and cons of available homes and, crucially, negotiate the final price. This dynamic demands that you, as a buyer, be exceptionally prepared and clear about your priorities.
Common Missteps in the Home Buying Journey
When the search begins, many buyers fall into predictable traps that can compromise their long-term satisfaction and financial return. Experts identify a few key mistakes, primarily revolving around faulty prioritization and an incomplete assessment of one’s own capabilities.
Mistake 1: Placing Price and Location Above All Else
While location and price are fundamental, Evaldas Matlauskas cautions against considering them in isolation. A common error is prioritizing a lower price in a strategically less-than-ideal location. If a property is cheaper but located poorly, even significant investment in renovations may not lead to adequate returns. He advises taking a broader view, focusing on the overall assessment of location and condition. A property in a good area, even if it requires an initial renovation investment, often offers significantly higher liquidity and better long-term appreciation. Always ask: Does the location provide added value to my life?
Mistake 2: Failing to Fully Assess Lifestyle and Needs
Both apartments and houses come with distinct trade-offs. Darius Burdaitis highlights that the choice must be a deeply personal one, evaluated against your specific lifestyle. For a similar price, you might afford an apartment in the city center or a larger house with a yard, more storage, and a garage in the suburbs. The mistake here is focusing solely on the size advantage of the house without properly factoring in the cost of that space—namely, the extra time and expense spent commuting, especially if necessary services are not readily accessible nearby. Failing to assess how the chosen property will impact your daily commute, family logistics, and access to essential services is a major oversight.
Mistake 3: Underestimating the True Cost and Time of Home Ownership
A house inherently demands more ongoing maintenance, time commitment, and often, a greater share of income for upkeep compared to an apartment. The error lies in only calculating the mortgage and initial purchase price while overlooking operational expenses. As Mr. Burdaitis points out, when contemplating a house, you must meticulously account for potential additional expenses and evaluate the surrounding infrastructure. This includes the quality of road access, public transport links, and the proximity to schools, kindergartens, medical facilities, and shops. The true cost of ownership extends far beyond the bank statement.
Practical Framework: Weighing Apartments vs. Houses
To make an informed choice, you must systematically compare the two property types across several non-negotiable criteria.
Financial and Maintenance Checklist
Feature
Apartment Considerations
House Considerations
Avoidable Mistake
Upkeep & Time
Less time-intensive; shared costs for building exterior. Predictable monthly fees.
Significant time commitment for lawn, exterior, and internal systems. Higher potential unexpected costs.
Underestimating the time and budget required for constant home maintenance.
Liquidity & Investment
Generally high liquidity in strategic, central locations. Consistent demand.
Liquidity is highly dependent on location, plot size, and construction quality. Potential for greater appreciation if well-located.
Prioritizing a large, cheap house far from urban centers, which can be hard to sell quickly.
Initial Cost & Space
Higher price per square meter in prime areas. Less storage/garage space.
Lower price per square meter further out. Offers green space, garage, and extra storage.
Being misled by the lower price/sqm of a distant house without factoring in commuting costs.
Lifestyle and Quality of Life Metrics
Evaldas Matlauskas suggests that the chosen location must create added value for the individual. This goes beyond mere convenience and touches on well-being.
Convenience: Apartments often provide superior access to well-developed public transport, nearby shops, and essential educational/medical institutions. Life is generally faster and more convenient.
Health and Wellness: For buyers who prioritize emotional and physical health, proximity to green zones, low noise levels, and security are vital. A house can offer a private yard, but an apartment near a large city park might offer comparable, maintenance-free access to nature. Always assess the security and general noise level of the neighborhood for both options.
Maximizing Your Decision: Expert Advice
To avoid expensive regret, follow this specific set of practical advice:
1. Prioritize Location and Condition Over Just Price
As E. Matlauskas advised, focus on the overall quality of the property and its area. A slightly more expensive but well-located property is a better investment than a cheap property in a poor location. Specific Advice: If considering a fixer-upper, calculate not just the renovation cost, but the cost of your time and the opportunity cost of that time.
2. Test Before You Commit: The Rental Tactic
Perhaps the most potent piece of advice is to temporarily rent the type of property you are leaning toward in a similar area before buying. Specific Advice: If you are debating moving to the suburbs for a house, rent one for six months to fully experience the daily commute, the added time for yard work, and the reality of a longer drive to amenities. This experiential insight is invaluable in making a rational decision.
Darius Burdaitis confirms that the type of property (house vs. apartment) generally does not significantly alter the basic loan conditions. Instead, the bank focuses on factors related to risk and stability. Specific Advice: Banks favor properties with high liquidity (easy to sell) and applicants with stable income and minimal existing financial obligations. To secure the most favorable loan terms, focus on these:
Property Quality: Newer properties and those in excellent locations receive better terms.
Energy Efficiency: Properties with an A+ or higher energy efficiency rating are often viewed favorably and may qualify for better loan conditions due to their lower environmental impact and long-term operating costs.
Banks typically offer loans with a 15-20% down payment, but your final offer depends on the property’s liquidity and your personal financial stability. The mistake here is assuming you can afford the home based on only the down payment; you must secure stable income before applying.
Conclusion: Your Tailored Homeownership Path
Choosing between an apartment and a house is not a matter of which is inherently “better,” but which is “better for you.” The process demands a clear-eyed assessment of your finances, a rigorous comparison of future lifestyle implications, and a disciplined focus on long-term investment value. Do not let the allure of size distract you from the reality of maintenance, nor the convenience of the city blind you to the potential for noise and lack of private space. By avoiding common mistakes—like prioritizing a low price over a great location, or underestimating the hidden costs of homeownership—and by following expert advice to test your decision before buying, you can confidently navigate the current active market. Remember that the right home should not only be a sound investment but also a setting that genuinely enhances your daily life, creating that essential added value you deserve.
