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
Latvia's rental market stands out in Europe for its attractive yields, especially in Riga where landlords can earn nearly 8% gross annually on residential properties.
Whether you're eyeing a studio near the Old Town or a family apartment in the leafy suburbs of Mežaparks, understanding the real numbers behind rental returns helps you make smarter investment decisions.
This article breaks down the current rental yields across Latvia's neighborhoods and property types, with fresh data from early 2026 that we update regularly.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Latvia.
Insights
- Latvia ranks among Europe's top performers for rental yields, with Riga delivering around 8% gross returns compared to just 3-4% in many Western European capitals.
- The gap between gross and net yields in Latvia typically runs 2 to 2.5 percentage points, with property taxes and maintenance eating less into returns than in most EU countries.
- Vecrīga (Old Town) offers yields up to 9.8% gross, but vacancy risk is higher due to seasonal tourism fluctuations and short-term rental competition in Latvia.
- Āgenskalns consistently shows lower yields (4.7-5.6% gross) because purchase prices have risen faster than rents in this trendy Riga neighborhood.
- Rail Baltica construction is already boosting rental demand near Riga Central Station and Riga Airport, with the project expected to complete by 2030.
- Latvia's flat 10% tax on rental income for registered landlords is one of the simplest and lowest rates in the European Union.
- Vacancy rates in Latvia average around 5% nationally, but central Riga runs tighter at 3-4% due to steady demand from young professionals and expats.
- Property prices in Riga rose 1.8% year-on-year to €863 per square meter in late 2025, marking the eighth consecutive month of price growth.
What are the rental yields in Latvia as of 2026?
What's the average gross rental yield in Latvia as of 2026?
As of early 2026, the average gross rental yield for residential properties in Latvia stands at approximately 7.9%, with Riga specifically delivering around 8.5% gross on average.
Most typical residential properties in Latvia fall within a realistic gross yield range of 5% to 9.5%, depending on location, property type, and whether you're in the capital or secondary cities like Jūrmala or Liepāja.
Latvia's gross yields are among the highest in Europe, significantly outperforming Western European capitals like Paris (2-3%), London (3-4%), and even outpacing neighboring Estonia and Lithuania by a small margin.
The single most important factor currently influencing gross rental yields in Latvia is the relatively low purchase price per square meter in Riga (averaging around €860) combined with stable rental demand from young professionals, IT workers, and expats who are drawn to the city's growing economy.
What's the average net rental yield in Latvia as of 2026?
As of early 2026, the average net rental yield for residential properties in Latvia is approximately 5.5% to 6%, after accounting for all recurring expenses.
The typical difference between gross and net rental yields in Latvia runs about 2 to 2.5 percentage points, which is relatively modest compared to many Western European markets where costs eat more heavily into returns.
The expense category that most significantly reduces gross yield to net yield in Latvia is maintenance and repairs, especially for older Soviet-era apartment buildings which make up a large portion of the housing stock and often require heating system upgrades or facade work.
Most standard investment properties in Latvia deliver net yields between 4% and 7%, with newer buildings in Riga's central districts typically landing near the top of that range due to lower maintenance costs, while older properties in suburban estates may require larger repair reserves that compress net returns.
By the way, you will find much more detailed rent ranges in our property pack covering the real estate market in Latvia.
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.
What yield is considered "good" in Latvia in 2026?
A gross rental yield of 7% or higher is generally considered "good" by local investors in Latvia, while anything above 8% is viewed as an excellent opportunity worth pursuing.
The threshold that typically separates average-performing properties from high-performing ones in Latvia is around 7.5% gross, with properties below this level often found in premium neighborhoods like Jūrmala or central Riga where capital appreciation tends to compensate for lower current income.
How much do yields vary by neighborhood in Latvia as of 2026?
As of early 2026, the spread in gross rental yields between the highest-yield and lowest-yield neighborhoods in Latvia reaches approximately 5 percentage points, ranging from around 4.5% in premium areas to nearly 9.8% in certain central Riga pockets.
The highest rental yields in Latvia typically come from neighborhoods with moderate purchase prices and strong tenant demand, such as Vecrīga (Old Town), Purvciems, Kengarags, and parts of Teika in Riga where entry prices remain reasonable while rents stay competitive.
The lowest rental yields in Latvia usually appear in prestigious or lifestyle-focused neighborhoods like Āgenskalns, Mežaparks, and parts of Jūrmala's beachfront, where buyers pay premium prices for architectural charm or green spaces that renters are not willing to match proportionally in rent.
The main reason yields vary so much across neighborhoods in Latvia is that purchase prices move faster than rents in desirable areas, meaning investors pay an "address premium" in trendy districts that compresses their returns, while less fashionable but still functional areas offer better income potential.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Latvia.
How much do yields vary by property type in Latvia as of 2026?
As of early 2026, gross rental yields across different property types in Latvia range from about 5% for larger houses and villas up to 9% or more for compact studios and one-bedroom apartments in well-located areas.
The property type currently delivering the highest average gross rental yield in Latvia is the small apartment segment, particularly studios and one-bedroom units in central Riga, where rent per square meter is maximized and tenant turnover keeps vacancy rates low.
The property type currently delivering the lowest average gross rental yield in Latvia is the detached house or villa category, especially in premium locations like Jūrmala or Mežaparks, where high purchase prices and seasonal rental demand compress annual returns significantly.
The key reason yields differ between property types in Latvia is that smaller units command higher rent per square meter because they serve a larger pool of renters (students, young professionals, expats), while larger properties attract fewer tenants who also expect proportionally lower per-meter rents for more space.
By the way, you might want to read the following:
What's the typical vacancy rate in Latvia as of 2026?
As of early 2026, the estimated average residential vacancy rate in Latvia is approximately 5%, meaning a typical landlord can expect about 2.5 weeks of vacancy per year on a well-priced property.
Vacancy rates across different neighborhoods in Latvia range from about 3-4% in high-demand central Riga areas like Centrs and Klusais centrs to 6-8% in outer estates like Zolitūde or Bolderāja where tenant turnover is higher.
The main factor that currently drives vacancy rates in Latvia is proximity to employment hubs and public transport, with properties near Riga's business districts, universities, and main transit corridors filling fastest while more remote locations experience longer void periods.
Latvia's vacancy rate compares favorably to the European average, running slightly tighter than many Western European capitals where oversupply has pushed vacancies higher, though it is similar to other Baltic states like Estonia and Lithuania.
Finally please note that you will have all the indicators you need in our property pack covering the real estate market in Latvia.
What's the rent-to-price ratio in Latvia as of 2026?
As of early 2026, the average rent-to-price ratio in Latvia (monthly rent divided by purchase price) is approximately 0.65%, meaning for every €100,000 of property value, landlords can expect around €650 in monthly rent.
A rent-to-price ratio of 0.6% or higher is generally considered favorable for buy-to-let investors in Latvia, and this metric is essentially the monthly equivalent of gross rental yield, so a 0.65% monthly ratio translates to roughly 7.8% annual gross yield.
Latvia's rent-to-price ratio compares very favorably to similar cities in the region, outperforming most Central European capitals like Prague (0.35-0.4%) and Warsaw (0.45-0.5%), though it is roughly on par with other Baltic cities like Tallinn and Vilnius.
We have made this infographic to give you a quick and clear snapshot of the property market in Latvia. 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.
Which neighborhoods and micro-areas in Latvia give the best yields as of 2026?
Where are the highest-yield areas in Latvia as of 2026?
As of early 2026, the top three highest-yield neighborhoods in Latvia are Vecrīga (Riga Old Town) with yields reaching 9.8%, parts of Purvciems and Kengarags on Riga's right bank, and Teika which offers solid returns combined with strong tenant demand.
In these top-performing areas like Vecrīga, Purvciems, and Teika, investors can expect average gross rental yields ranging from 7.5% to nearly 10%, depending on the specific micro-location and property condition.
The main characteristic these high-yield areas in Latvia share is a combination of relatively affordable purchase prices (often €800-€1,200 per sqm) paired with steady rental demand from local workers, students, and young professionals who prioritize commute convenience over prestige.
You'll find a much more detailed analysis of the areas with high profitability potential in our property pack covering the real estate market in Latvia.
Where are the lowest-yield areas in Latvia as of 2026?
As of early 2026, the top three lowest-yield neighborhoods in Latvia are Āgenskalns (4.7-5.6% gross), parts of Mežaparks, and premium beachfront sections of Jūrmala, where lifestyle premiums inflate purchase prices beyond what rents can justify.
In these low-yield areas like Āgenskalns, Mežaparks, and Jūrmala, investors typically see average gross rental yields in the range of 4% to 5.5%, which is still respectable by European standards but below Latvia's national average.
The main reason yields are compressed in these areas of Latvia is that buyers pay a significant premium for architectural character (like Āgenskalns' wooden Art Nouveau buildings), green spaces (Mežaparks), or beach access (Jūrmala), but renters set their budgets based on practical needs rather than lifestyle aspirations.
Buying a property in a low-yield area is one of the mistakes we cover in our list of risks and pitfalls people face when buying property in Latvia.
Which areas have the lowest vacancy in Latvia as of 2026?
As of early 2026, the top three neighborhoods with the lowest residential vacancy rates in Latvia are Centrs (Riga city center), Klusais centrs (Quiet Centre), and Āgenskalns, where strong demand keeps apartments filled almost year-round.
In these low-vacancy areas like Centrs, Klusais centrs, and Āgenskalns, vacancy rates typically run between 2% and 4%, meaning landlords experience only one to two weeks of vacancy per year on average.
The main demand driver that keeps vacancy low in these areas of Latvia is the concentration of offices, embassies, cafes, and cultural venues that attract young professionals, expats, and embassy staff who value walkability and urban convenience.
The trade-off investors typically face when targeting these low-vacancy areas in Latvia is that the same desirability that keeps units filled also drives up purchase prices, which compresses gross yields even as income stability improves.
Which areas have the most renter demand in Latvia right now?
The top three neighborhoods currently experiencing the strongest renter demand in Latvia are Centrs, Āgenskalns, and Teika in Riga, where well-priced listings typically receive multiple inquiries within the first week.
The renter profile driving most of the demand in these areas is young professionals working in IT, finance, and international companies, along with expats and embassy personnel who prioritize modern amenities, good transport links, and proximity to Riga's business districts.
In these high-demand neighborhoods like Centrs, Āgenskalns, and Teika, rental listings typically get filled within two to four weeks, with well-maintained one-bedroom apartments in good locations often securing tenants within days of listing.
If you want to optimize your cashflow, you can read our complete guide on how to buy and rent out in Latvia.
Which upcoming projects could boost rents and rental yields in Latvia as of 2026?
As of early 2026, the top three upcoming infrastructure projects expected to boost rents in Latvia are the Rail Baltica high-speed railway (completion targeted for 2030), the Riga Central Station modernization project, and the Riga International Airport Rail Baltica terminal expansion.
The neighborhoods most likely to benefit from these projects include Torņkalns and areas near Riga Central Station, the Mārupe and Riga Airport corridor, and transit-accessible districts like Skanste and parts of Teika that will gain improved connectivity to the new rail infrastructure.
Once these projects are completed, investors might realistically expect rent increases of 5% to 15% in directly affected areas, with properties within walking distance of new Rail Baltica stations likely to see the strongest appreciation as commute times to other Baltic capitals and Warsaw drop dramatically.
You'll find our latest property market analysis about Latvia here.
Get fresh and reliable information about the market in Latvia
Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.
What property type should I buy for renting in Latvia as of 2026?
Between studios and larger units in Latvia, which performs best in 2026?
As of early 2026, studios and one-bedroom apartments in Latvia outperform larger units in terms of rental yield, delivering approximately 8-10% gross compared to 5-7% for two and three-bedroom apartments.
Studios in central Riga typically yield around €400-€600 per month (about $420-$630 USD or €400-€600 EUR), while larger two-bedroom units yield €700-€900 per month (about $735-$945 USD or €700-€900 EUR), but the smaller units achieve higher returns relative to their purchase price.
The main factor that explains why studios outperform in Latvia is that a larger pool of tenants (students, young professionals, digital nomads) actively seek compact, affordable housing, which keeps demand high and vacancy low for smaller units.
However, larger units become the better investment choice in Latvia when targeting families or long-term corporate tenants, as these renters sign longer leases and cause less turnover, which can improve net returns despite lower gross yields.
What property types are in most demand in Latvia as of 2026?
As of early 2026, the most in-demand property type in Latvia is the renovated one-bedroom apartment in central Riga, which attracts the widest pool of tenants and fills fastest.
The top three property types ranked by current tenant demand in Latvia are one-bedroom apartments in good locations, two-bedroom apartments suitable for young couples or roommates, and affordable studios near universities or public transport hubs.
The primary demographic trend driving this demand pattern in Latvia is the growth of Riga's IT sector and international business community, which brings young professionals who prioritize modern finishes, energy efficiency, and walkable neighborhoods over raw space.
One property type that is currently underperforming in demand in Latvia is the large detached house in suburban locations, which appeals to a narrow buyer or tenant pool and often sits vacant longer due to higher rents and maintenance expectations.
What unit size has the best yield per m² in Latvia as of 2026?
As of early 2026, the unit size range that delivers the best gross rental yield per square meter in Latvia is 25 to 45 square meters, which corresponds to studios and compact one-bedroom apartments.
For this optimal unit size in Latvia, the typical gross rental yield per square meter works out to approximately €10-€13 per sqm per month (about $10.50-$13.65 USD or €10-€13 EUR), compared to €7-€9 per sqm for larger apartments.
The main reason smaller units outperform on a per-meter basis in Latvia is that tenants pay a base premium for any functional living space, so landlords of compact apartments capture more rent per square meter, while larger units must discount their per-meter rate to remain affordable.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Latvia.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Latvia 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.
What costs cut my net yield in Latvia as of 2026?
What are typical property taxes and recurring local fees in Latvia as of 2026?
As of early 2026, landlords in Latvia should expect annual property taxes of approximately €200 to €600 (about $210 to $630 USD or €200 to €600 EUR) for a typical rental apartment, depending on the property's cadastral value and location.
Other recurring local fees landlords must budget for in Latvia include building management fees (typically €30-€80 per month or about $32-$84 USD), land tax for ground-floor or house properties, and potential municipal waste fees that vary by municipality.
Property taxes and recurring fees in Latvia typically represent about 3% to 6% of gross rental income, which is relatively modest compared to many Western European countries where these costs can exceed 10%.
By the way, we cover all the hidden fees and taxes in our property pack covering the real estate market in Latvia.
What insurance, maintenance, and annual repair costs should landlords budget in Latvia right now?
The estimated annual landlord insurance cost for a typical rental property in Latvia is approximately €100 to €250 (about $105 to $260 USD or €100 to €250 EUR), depending on coverage level and property value.
The recommended annual maintenance and repair budget in Latvia is about 8% to 12% of annual rental income, or roughly €800 to €1,200 (about $840 to $1,260 USD or €800 to €1,200 EUR) for a property valued around €100,000.
The type of repair expense that most commonly catches landlords off guard in Latvia is heating system repairs or upgrades, especially in older Soviet-era buildings where aging radiators, pipes, and central heating connections can require substantial investment during cold winters.
The total combined annual cost landlords should realistically budget for insurance, maintenance, and repairs in Latvia is approximately €1,000 to €1,500 (about $1,050 to $1,575 USD or €1,000 to €1,500 EUR) for a standard rental apartment.
Which utilities do landlords typically pay, and what do they cost in Latvia right now?
The common practice in Latvia is for tenants to pay their own electricity, heating, water, and internet directly, while landlords typically handle only the fixed building management charges, especially in longer-term unfurnished rentals.
For landlords who do include some utilities (often in furnished short-term rentals), the estimated monthly cost in Latvia is approximately €50 to €150 (about $52 to $157 USD or €50 to €150 EUR), with heating during winter months representing the largest variable expense.
What does full-service property management cost, including leasing, in Latvia as of 2026?
As of early 2026, the estimated monthly property management fee for full-service management in Latvia is approximately 8% to 12% of monthly rent, which works out to roughly €50 to €100 (about $52 to $105 USD or €50 to €100 EUR) per month for a typical Riga apartment.
The typical leasing or tenant-placement fee charged on top of ongoing management in Latvia is about one month's rent (€500-€800 or about $525-$840 USD) for finding and screening a new tenant, though some agencies offer reduced rates for longer management contracts.
What's a realistic vacancy buffer in Latvia as of 2026?
As of early 2026, landlords in Latvia should set aside approximately 5% to 8% of annual rental income as a vacancy buffer, which translates to about three to four weeks of potential vacancy per year.
The typical number of vacant weeks per year landlords experience in Latvia ranges from two weeks in high-demand central Riga locations to four or five weeks in outer residential estates, with well-priced properties in popular neighborhoods filling fastest.
Buying real estate in Latvia can be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Latvia, we always rely on the strongest methodology we can... and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why It's Authoritative | How We Used It |
|---|---|---|
| Global Property Guide | It's a respected international property research platform that publishes standardized rental yield data across 80+ countries. | We used their Q2 2025 Latvia rental yield figures as our primary anchor for gross yield estimates. We also used their neighborhood breakdowns for Riga to identify yield variations across districts. |
| Arco Real Estate | It's Latvia's leading real estate consultancy with over 25 years of market experience and regular price index publications. | We used their monthly apartment price data to track Riga's price trends through late 2025. We also used their supply analysis to understand inventory dynamics across neighborhoods. |
| Latvia State Revenue Service (VID) | It's the official government tax authority responsible for rental income taxation and property tax guidelines. | We used their published tax rates to calculate the 10% flat rental income tax. We also used their property tax schedules to estimate annual landlord costs. |
| Latvia Ministry of Finance | It's the official government body that sets tax policy and publishes authoritative rate schedules. | We used their immovable property tax rate documentation to verify residential rates of 0.2% to 0.6%. We referenced their legal framework for cadastral value calculations. |
| City24 | It's one of Latvia's largest property portals with thousands of active rental and sales listings. | We used their listing data to cross-check rental prices across Riga neighborhoods. We also used listing turnover to estimate vacancy rates and demand patterns. |
| SS.lv | It's Latvia's most popular classified ads platform with extensive property listings and price transparency. | We used their rental listings to validate price ranges across property types. We triangulated their data with other sources to confirm market rates. |
| Latvia Sotheby's International Realty | It's a premium real estate agency with deep expertise in Riga, Jurmala, and Pieriga luxury markets. | We used their Q1 2025 market report for premium segment pricing insights. We also referenced their transaction data to understand high-end market dynamics. |
| Rail Baltica | It's the official joint venture coordinating the largest infrastructure project in Baltic history. | We used their construction updates to identify areas likely to see rent appreciation. We referenced their completion timelines for investment planning context. |
| Latvia Ministry of Transport | It's the official government body overseeing transport infrastructure and Rail Baltica implementation in Latvia. | We used their project announcements to track mainline construction progress. We referenced their station location plans to identify affected neighborhoods. |
| Central Statistical Bureau of Latvia | It's the official national statistics agency publishing authoritative housing and economic data. | We used their house price index to confirm nationwide price trends. We referenced their housing stock data to understand market composition. |
| Bank of Latvia | It's the central bank providing official mortgage rate data and economic indicators. | We used their interest rate data to understand financing conditions affecting buyers. We referenced their housing market commentary for demand context. |
| OECD Housing | It's an international organization providing standardized housing market analysis across member countries. | We used their Latvia housing studies to understand rental market structure. We referenced their comparative data to benchmark Latvia against European peers. |
| KPMG Latvia | It's a Big Four accounting firm publishing authoritative annual tax guides for Latvia. | We used their 2025 Tax Card to verify rental income tax rates. We cross-checked property-related deductions and landlord obligations. |
| Grant Thornton Latvia | It's an international accounting network with deep expertise in Latvian tax and regulatory matters. | We used their tax summaries to validate income tax calculations. We referenced their guidance on landlord registration requirements. |
Get the full checklist for your due diligence in Latvia
Don't repeat the same mistakes others have made before you. Make sure everything is in order before signing your sales contract.