The housing market in Latvia is slowly recovering; the largest loans for housing were granted in Riga

Despite the fact that inflation is currently low across Europe and wages are rising, the housing market is still slowly recovering. In the new projects, the prices are high and the residents cannot afford it, while the banks are willing to lend to terraced houses. The 360TV news program “Ziņneši” tells more about the situation in the housing market.

Latvia’s economy is growing steadily, and the high interest rates continue to slow down the development of the housing market. In the market for the first time, that is, in new projects, the demand is low, and in serial rooms, the demand is higher. To a large extent, this is related to the income of the population, as well as high property prices.

If you look at it Bank of Swedenwhich is also the largest creditor of private persons in Latvia, this year this bank has issued loans for housing in the entire region of Latvia, except the region of Krāslava, with Riga and Pierīga standing at the forefront, of course.

A mortgage loan is the most popular way to buy a home. And the distribution of these loans could increase next year as people’s purchasing power will also increase, taking into account the reduction in labor taxes. Also good news is the drop in Euribor and the interest rate of the European Central Bank. But isn’t it true that the banks will want to offset their loyalty fee?

“Of course, we are currently looking forward to what this final version of the law will be like. Therefore, which loans will be affected by this law of solidarity, and from there we will create a -next year’s technique directly on prices,”

Normunds Dūcis says, Bank of Sweden head of mortgage lending in the Baltics.

according to Bank of Sweden stated, the majority of Latvian and Baltic residents already own a first home, and this is largely due to their post-Soviet legacy, namely to ‘expropriation after the collapse of the USSR. True, this situation did not apply to young people who are still planning to buy their first home. The situation there is much worse.

“Generation Z and maybe one generation before that, well, the current situation around the world is so much, if we had previously seen that the population had become richer and richer with each generation, now the situation is not so clear anymore. “economically the situation is that there are limits to trade, growth is not as fast. Well, this is definitely slowing down the ability of that generation to be able to buy and, perhaps, hope for the future,” said Liva Zorgenfreja, Bank of Sweden a leading economist in Latvia.

There may not be an economic basis for a rapid improvement in the housing market right now, but experts say the worst is behind us.

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