Over the last two years, the proportion of Latvian residents who expect house prices to rise in the near future has increased by almost 20 percentage points, according to the latest Luminor bank survey*. Currently, 71% of those surveyed predict a price increase, while only 6% anticipate a decrease. Although house prices in Latvia continue to rise, they remain the lowest in the Baltics.

A rise in house prices is most often expected by the younger generation – in the 18 to 29 age group, 79% of respondents think so, for whom the question of buying their own home will become increasingly relevant in the near future. The sentiment in Riga is more pronounced than the national average, as 77% of residents in the capital expect house prices to rise in the near future.

At the same time, less than a tenth of Latvian residents believe that house prices will remain unchanged, while 14% are unsure about future price trends.

“Public confidence in rising house prices is growing, and there is good reason for it – market activity is being driven by wage growth, a broader supply of new housing and favourable lending conditions. We currently see no prerequisites for a drop in house prices, and overall, house prices could grow within the range of 5–10% this year. Housing affordability in Latvia remains better than in our neighbouring countries, so it is important to maintain balanced market development – ensuring that housing is financially accessible to households and that developers have a basis to create new, high-quality and energy-efficient homes,” says Kaspars Sausais, Head of Housing Lending at Luminor bank.

The sentiment regarding house price increases is similar in the other Baltic states – in Estonia, 78% of residents expect it in the near future, and 79% in Lithuania.

Housing in Riga remains cheaper than in Vilnius and Tallinn

Latvia still maintains the lowest level of house prices among the Baltic states, and although prices continue to rise in Riga as well, house prices in the capitals of our neighbouring countries still significantly exceed those in Riga. Real estate valuation data, which is used in making financing decisions, shows that prices in the new development segment have grown by approximately 5% this year compared to last year. The transaction price per square metre for new housing already exceeds 2,500 euros on average, but in the most sought-after areas of Riga, including the centre and Āgenskalns, it can reach 3,000–4,000 euros per square metre.

Data compiled by Luminor shows that the average price for new developments in Vilnius is approximately 4,080 euros per square metre, and around 3,400 euros in the secondary market. In Tallinn, the average price for an apartment in a new development reaches around 4,700 euros per square metre, while it is around 3,000 euros per square metre in the secondary market.

Residents are purchasing homes more actively

Market activity in Latvia continues to rise. Data from Luminor bank shows that in the first six months of this year, the volume of funding issued for home purchases was 13% higher than in the corresponding period last year. Households are increasingly willing to make the long-term decision to purchase their own home, driven by a more stable labour market and income situation, as well as greater confidence in economic development.

At the same time, with the continued rise in prices, particularly in the new development segment, buyers are more carefully evaluating not only the price of the property but also its quality, energy efficiency, location and maintenance costs. Although serial-build apartments still make up the majority, or nearly a third, of the housing transactions financed by Luminor in Latvia, interest is also growing in new developments, which accounted for 29% of transactions in the first half of the year, as well as in housing in the Riga region and private houses.

*The Luminor bank survey was conducted in August 2026 in collaboration with the research agency Norstat, surveying 1,001 respondents in Latvia aged between 18 and 60.