Trends in the Latvian Real Estate Market in Autumn 2021

One of Latvia's largest developers, "Bonava Latvija", has prepared a presentation on market trends.

We invite you to familiarize yourself with the most interesting points:

• From July 1st, the fee for registering transactions has been reduced. For individuals - from 2% to 1.5%. For legal entities (apartment purchases) from 6% to 2%. This has increased transaction growth.

• Mass-produced housing is increasing in price because these are the cheapest and most in-demand apartments, but their technical condition is deteriorating each year. 72% of Riga residents live in Soviet-era buildings.

• Some buyers expected that due to the pandemic, property prices would fall. But the opposite happened - prices are increasing because demand for quality, convenient housing has grown.

• New housing is increasing in price rapidly. Given that the construction cycle and commissioning takes approximately two years, new projects that were started in 2018 or 2019 are currently being sold off. Due to the pandemic, some projects in 2020 and 2021 were suspended. Consequently, in 2022 and 2023 there will be few offerings. The cost of already-built, quality new housing will increase. There is investment potential here.

• Banks offer good credit conditions to buyers who choose new construction. Moreover, banks compete with each other by providing mortgage lending services. For example, you can get a free property appraisal and reduced commission on loan processing. In the second quarter of this year, 28% more loans were issued than in the first quarter.

• When choosing new construction, pay attention to the developer's reputation, get feedback on previous projects, and ensure that operating costs will be reasonable. It is also important to check the warranty period. Customization options (for example, in choice of finishes) is also a pleasant bonus.

• If you reserve an apartment at the start of construction, after the building is completed, the market value of the apartment may increase by 10%.

• High demand for housing is due to a combination of factors - the willingness of banks to issue loans, good savings among the population (due to the pandemic there are few opportunities to spend and many opportunities to save), government support programs for young families, and the natural desire of many families to improve their housing conditions.

Based on our company's observations, a reasonable alternative to new construction is apartments in reconstructed buildings. They are also of high quality, located in good areas (for example, in central Riga), have convenient layouts, and sometimes cost less than new buildings.

If you wish to purchase any quality real estate property and personal attention is important to you, if you want to communicate with a real estate agent and lawyer in your native language, contact our company KOM-INVEST! We will be happy to select a suitable property, answer all your questions, draw your attention to essential details, process your transaction, arrange your residence permit, and manage your property.