What foreigners want in Latvian real estate

Local Latvian residents are showing greater interest in standard type apartments near the city center or in residential areas, while foreigners—mostly those interested in obtaining a temporary residence permit—are interested in apartments in new projects or renovated pre-war houses with all the amenities and in a good location, such as the center of Riga or in the resort town of Jūrmala, reports LANĪDA, the Latvian Real Estate Association.
Generally, foreign nationals who wish to obtain a residence permit are looking for property worth 150 000 – 200 000 EUR. The price difference between standard type apartments and new projects is significant, with the average price of standard type apartments at 600 EUR/m2 while new projects prices range from 1000 to 1600 EUR/m2, depending on amenities and location.
Since mid-2010 there is a noticeable increase in the interest by foreign citizens' in real estate acquisition. During this period there were 328 applications from investors about purchasing a property to obtain a temporary residence permit. The largest monetary transaction that has occurred was for 594 000 LVL (845,000 EUR).
Edgars Shins, president of LANĪDA, commented on the news coverage of the market. "It should be noted that talks about the activity growth in the Latvian real estate market are strongly exaggerated. Of course, there is a certain increase in non-resident interest thanks to the relatively simple ways of acquisition of temporary residence permits. Nevertheless, the overall level of change is not especially considerable. The quantity of transactions grew at the beginning of the year and this summer, yet it has remained at the same level during the past few months. We hope the next year will become a year of stabilization for the Latvian real estate market."
Shins also noted that the rental market has picked up speed in response to the country's current economic situation. Until now, Latvian citizens actively sought ownership of apartment, but public opinion is beginning to change. Due to problems in obtaining a credit, the demand for rentals continues to grow. The supply of good apartments is low, so rental prices are gradually rising, up 1.5% in September. Further increases are expected in the next six months, despite the start of the heating season. (ICREA)