Authored by the expert who managed and guided the team behind the Latvia Property Pack
Everything you need to know before buying real estate is included in our Latvia Property Pack
What is happening in Latvia’s real estate market? Are prices on the rise or decline? Is Riga still a magnet for foreign investors? How are Latvia’s government policies and taxes shaping the real estate landscape in 2025?
These are the questions we hear every day from professionals, buyers, and sellers across Latvia, from Riga to Liepaja and beyond. Maybe you’re curious about these trends too.
We know this because we stay closely connected with local experts and individuals like you, exploring the Latvian real estate market daily. That’s why we crafted this article: to offer clear answers, insightful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to message us with your thoughts, and we’ll strive to enhance this content for you.
How this content was created 🔎📝
1) Russian buyers in Latvia will decrease due to geopolitical tensions and economic sanctions
Russian buyers are pulling back from the Latvian property market due to ongoing geopolitical tensions and economic sanctions.
Latvia, like Finland, is tightening rules on foreign property ownership, specifically targeting Russian nationals. This is part of a larger strategy to curb foreign influence in the real estate sector. The Latvian government has also removed Russia from its Golden Visa Program, which has led to a noticeable drop in the number of golden visas issued over the past couple of years.
Economic sanctions against Russia have significantly impacted the purchasing power of Russian citizens. These sanctions make it harder for Russians to invest in foreign real estate, including in Latvia. The Latvian economy has also cooled rapidly, and the ruble's value has plummeted, further discouraging Russian investments in the country.
For those considering buying property in Latvia, it's important to understand these dynamics. The market is shifting due to these geopolitical and economic factors, which could affect property values and availability. If you're looking to invest, staying informed about these changes is crucial.
Local real estate agents have noted a shift in the types of buyers entering the market. With fewer Russian buyers, there's a growing interest from other European countries, which is reshaping the landscape of property ownership in Latvia.
As Latvia continues to navigate these complex geopolitical waters, potential buyers should keep an eye on how these factors might influence their investment decisions. Understanding the local market conditions and regulations is key to making a sound investment.
Sources: OCCRP, BTI Project, Schengen News
2) Latvia’s property prices will steadily rise due to limited supply and increasing demand
Latvia's residential property prices are on the rise, and this trend is expected to continue steadily.
One big reason for this is the limited supply of new housing developments. Even though new projects in the premium apartment market hit 70% in 2023, it hasn't really boosted the overall housing supply. The main issue is the scarcity of land available for new construction, making it tough to keep up with the growing demand for homes.
Demand for homes in Latvia is climbing, especially in cities like Riga. In 2023, the premium apartment market in Riga saw a 19.2% increase in turnover compared to the previous year. More people are moving to urban areas, with 68.67% of the population living in cities in 2023, which naturally pushes up the need for housing.
Latvia's economy is on a steady growth path, which boosts consumer confidence and gives potential homebuyers more purchasing power. This economic upswing, along with rising foreign investment in Latvian real estate, is adding fuel to the demand for homes.
With limited supply and growing demand, it's no surprise that property prices in Latvia are expected to keep climbing. The combination of these factors creates a perfect storm for a competitive housing market.
Sources: Latvia Sotheby's Realty, Trading Economics, The Global Economy
We made this infographic to show you how property prices in Latvia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
3) Rental yields in Latvia’s capital will dip slightly as more properties boost competition among landlords
Riga is buzzing with new residential developments popping up all over the city.
Take the Lucavsala project, for example, which is set to bring 590 new apartments into the mix. This means more options for renters and a bit more competition for landlords.
On top of that, more property owners are jumping onto rental platforms. In June 2023, there was a 30% increase in apartments for sale in Riga's largest housing estates compared to the previous year. Many of these are likely turning into rental properties, adding to the supply.
Latvia's housing stock isn't slowing down either, with new dwellings authorized rising by 10.1% to 3,140 units in 2022. This steady growth is nudging rental prices down as landlords try to fill their properties.
In fact, apartment prices in Riga took a dip, falling by 8.42% in June 2023 from the previous year. This suggests landlords might be sweetening the deal to attract tenants.
With more properties entering the market, rental yields in Riga are expected to decline slightly, making it a tenant's market.
Sources: Lucavsala Residential Project, Rental Yields in Latvia, Latvia Residential Real Estate Market Analysis
4) Eastern Latvia will attract more investors with lower property prices and government incentives for regional development
The eastern regions of Latvia are becoming a hotspot for investors, thanks to lower property prices and government incentives for regional development.
In 2023 and 2024, Latvia saw a 30% surge in foreign investment, with exciting projects in bioeconomics, ICT, and smart energy. This uptick shows a growing interest in the region, despite challenges like administrative hurdles and a shadow economy.
The Latvian government is actively encouraging investment in these areas. The Ministry of Smart Administration and Regional Development (VARAM) has rolled out a comprehensive plan for 2025-2027 to boost the Eastern border's development. This plan aims to create 712 new jobs and attract 56.9 million euros in private investment, enhancing regional security and quality of life.
Infrastructure is a big part of making the eastern regions more appealing. The government plans to upgrade 34 km of highways, reconstruct the Vienības bridge, and improve the broadband network. These changes are expected to make business operations smoother and draw more investors.
For those considering property investment, these developments mean better connectivity and improved facilities, making the region a more attractive option. The government's focus on infrastructure and job creation is a clear signal of their commitment to regional growth.
With these initiatives, the eastern regions of Latvia are poised to become a key investment destination, offering opportunities in various sectors and a supportive environment for growth.
5) Latvia's university towns will experience increased rental demand due to more international students arriving
The rental market in Latvia's university towns is booming thanks to a wave of international students.
At the University of Latvia, there are over 1,000 foreign students enrolled, while Rīga Stradiņš University (RSU) boasts more than 2,900 international students from 77 different countries. This year alone, RSU welcomed a record 508 new international students, highlighting the growing appeal of Latvia as a study destination.
Universities are not just sitting back; they are actively expanding their international programs. The University of Latvia has a strategy in place to attract more students from abroad, and RSU's programs in Medicine and Dentistry are particularly popular. The Latvian government is also playing its part, with a student visa success rate of over 90%, making it easier for students to come and study.
Real estate agents are noticing a trend: more international students are inquiring about rentals, indicating a preference for renting rather than buying. This is happening alongside reports of housing shortages in university towns, which are likely to push rental prices up. As more students choose Latvia, the demand for rental accommodation is expected to keep rising.
Sources: University of Latvia, Rīga Stradiņš University, Leverage Edu
Don't buy the wrong property, in the wrong area of Latvia
Buying real estate is a significant investment. Don't rely solely on your intuition. Gather the right information to make the best decision.
6) New rental rules in Latvia will protect tenants more, affecting landlord strategies
Latvia's rental regulations have recently changed to offer more protection for tenants.
These changes stem from the New Residential Rent Law of 2021, which aims to balance tenant and landlord interests. The law gives tenants new rights and responsibilities, like using their rented homes without interference and ending contracts with reasonable notice.
One major rule is that landlords can't raise rent unless it's in the lease. This protects tenants from unexpected rent hikes, so landlords must clearly state any possible increases in their contracts. If landlords don't fix issues that stop tenants from using their homes properly, they face administrative penalties.
Landlords now need written agreements with clear terms, which means they must adjust leases to meet the new rules. This might involve adding conditions for rent increases and making sure tenant rights are clear. As a result, landlords may seek more legal advice to navigate these changes.
Tenant advocacy groups note that these changes have made tenants more aware and empowered. With clearer laws, tenant disputes might be resolved more often in their favor, leading to a more tenant-friendly market.
Sources: BNT Legal News, Statista, OECD Report
7) Riga’s suburbs will see increased demand as remote work leads people to seek larger homes outside the city center
Remote work is reshaping where people choose to live, with 10.5% of Latvians working from home in 2023.
As more folks embrace this flexibility, they're eyeing the suburbs for larger homes. Riga's city center saw an 8.42% drop in apartment prices mid-2023, pushing people to seek more affordable and spacious options outside the hustle and bustle.
Families, in particular, are drawn to the quieter suburban lifestyle, where they can enjoy more room to breathe. The trend is clear: suburban real estate listings in areas like Purvciems have surged by 30%, showing a growing interest in these areas.
Modern professionals are increasingly looking for jobs that let them work from anywhere, making them less tied to city centers. This shift is supported by improved infrastructure in suburban areas, like better public transport and new roads, making it easier to commute to the city when needed.
Social media and media reports often highlight the perks of suburban living, such as more space and lower costs, which are enticing more people to consider these areas. Suburban living offers a better quality of life without sacrificing access to urban amenities.
With remote work becoming more common, Riga's suburbs are set to see a surge in demand as people seek larger living spaces outside the city center.
Sources: Global Property Guide, Stat.gov.lv, Fast Company
8) Latvian properties with home office spaces will be in higher demand as remote work continues long-term
Properties with home office spaces are becoming a hot commodity in Latvia as remote work continues to shape the way we live and work.
Latvian employees are increasingly favoring jobs that offer remote or hybrid work options. This shift is largely due to Latvia's excellent internet connectivity, which makes working from home not just possible, but appealing. Many workers now see remote work as a priority when considering job opportunities.
Big companies in Latvia, like Microsoft and Accenture, are leading the charge by adopting long-term remote or hybrid work policies. This change is part of a broader effort to retain top talent through flexible work arrangements. As a result, more people are on the hunt for homes that can accommodate a dedicated office space.
In Riga, the real estate market is responding to this demand. The number of apartments with dedicated office spaces has surged, reflecting the growing interest in homes that support remote work. This trend is not just about convenience; it's about creating a better work-life balance and cutting down on commute times.
Media coverage is also playing a role in this shift, highlighting the benefits of having a home office. People are increasingly aware of how a dedicated workspace can improve productivity and overall quality of life. Home offices are becoming a key selling point in the property market.
As remote work remains a long-term trend, properties with home office spaces will continue to be in high demand in Latvia. This is a trend that shows no signs of slowing down.
Sources: Global Property Guide, 9cv9 Blog
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Latvia. 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.
9) Flood risk assessments will play a key role in Latvian property valuations as climate change awareness grows
In Latvia, floods have become more frequent and severe, especially in 2023 and 2024.
Take the storm in July 2024, for example, which caused massive flooding and damage to thousands of homes. This event has made people more aware of how climate change can affect property safety and value. The government is actively identifying flood-prone areas, especially around the Salaca, Gauja, and Daugava river basins, where water levels can rise quickly. These reports are essential because they help determine which areas are at risk, directly impacting property values.
Insurance companies are also taking note. They might increase premiums for properties in high-risk areas, which could lower the market value of these properties. This is a common practice worldwide, and it’s something potential buyers should consider. Media coverage and public surveys show that people are increasingly worried about climate change and flood risks, which also plays a role in how properties are valued.
Sources: LSM, EIB Survey
10) Eco-friendly homes will become more popular in Latvia as environmental awareness grows
Eco-friendly homes are gaining traction in Latvia as more people become environmentally conscious.
In a significant move, the European Investment Bank has partnered with the Latvian government to push for energy-efficient housing. This collaboration aims to build thousands of new apartments by 2030, all with a focus on eco-friendly designs. The goal is to create living spaces that not only reduce energy consumption but also promote a sustainable lifestyle.
Latvians are increasingly interested in homes that are energy-efficient and have a smaller carbon footprint. This shift is driven by a growing awareness of environmental issues and the benefits of sustainable living. As a result, more builders are adopting green practices to cater to this demand, making eco-friendly homes more accessible to the average buyer.
Government incentives and strategic frameworks are also in place to support sustainable housing projects. These initiatives, backed by organizations like the InvestEU Advisory Hub, demonstrate the government's commitment to promoting eco-friendly living spaces. Such support makes it easier for developers to incorporate sustainable features into their projects.
Social media platforms like Instagram and Facebook are buzzing with discussions and tips on sustainable living, influencing consumer behavior. Educational programs are also playing a crucial role by raising awareness about the benefits of eco-friendly homes, further driving demand. This combination of online influence and education is making sustainable living a mainstream choice in Latvia.
As environmental consciousness continues to rise, it's clear that eco-friendly homes will become even more popular. The trend is supported by a mix of government initiatives, consumer demand, and social media influence, all pointing towards a future where sustainable housing is the norm.
Sources: EIB Press Release, The Madrona Group
11) Property values in well-connected areas of Latvia will rise with investment in public transportation infrastructure
Latvia is investing heavily in public transportation, which is expected to boost property values in well-connected areas.
In 2023, the Latvian government allocated EUR334.5 million for road infrastructure, including public transportation. This significant investment is part of a broader strategy to enhance connectivity and accessibility across the country. Improved transit systems not only make commuting easier but also attract more people to live in these areas, driving up property demand and prices.
Looking at other countries, we see a clear pattern: better transit access often leads to higher property values. Take Vancouver, Canada, for instance. The expansion of the SkyTrain system there has resulted in increased property values in areas with enhanced transit access. This trend suggests that Latvia could experience similar outcomes as it continues to improve its public transportation network.
In Latvia, the real estate market is already showing signs of this trend. Reports indicate a growing demand for properties in well-connected areas. According to ResearchAndMarkets.com, the Latvian construction industry is expected to grow, driven by investments in transport and real estate projects. This growth reflects a strong interest in properties near public transportation, further supporting the idea that property values will rise in these areas.
Moreover, the Latvian government's commitment to projects like Rail Baltica highlights their focus on enhancing regional connectivity. Such projects are not just about improving transportation; they are about creating economic opportunities and increasing property values in the surrounding areas. As these projects progress, we can expect to see a ripple effect on the real estate market.
For potential property buyers, this means that investing in areas with good transit access could be a smart move. As public transportation infrastructure continues to develop, these areas are likely to become more desirable, leading to higher property values and better returns on investment.
Sources: Statista Market Forecast, Latvian Government Funding for Rail Baltica, Latvia Construction Market Analysis
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.