Published on and written by Cyril Jarnias
Investing in real estate outside one’s country of residence is increasingly attractive to expatriates. Among the still relatively affordable destinations within the European Union, Latvia holds a unique position: accessible real estate market, attractive taxation, a residence-by-investment program, and a strategic location between Northern Europe, Russia, and the Baltic states. But behind this appealing facade, you need to understand the rules of the game, the actual figures, and the risks.
This guide covers the essential elements for a real estate investment in Latvia: recommended areas, price levels, tax obligations, how the ‘Golden Visa’ program works, and the steps to secure a remote purchase.
Understanding the Latvian environment for a real estate investment
Latvia is a small sovereign state within the European Union, a member of the eurozone and the Schengen Area. It is located in Northern Europe, on the Baltic Sea, between Estonia, Lithuania, Russia, and Belarus. This position makes it a true transit hub between the EU and the former Soviet space.
The country’s GDP is expected to grow by more than 11% over the next five years.
Inflation, which spiked above 21% in early 2023, has significantly cooled to around 2.4% in 2024, although it occasionally remains slightly higher than the eurozone average. This disinflation is helping to stabilize real estate prices after several years of rapid increases.
Latvia is very open to foreign capital. The key points for an expatriate investor are simple to remember:
All business sectors are open to foreign investors. A non-resident can hold 100% of the capital of a local company, and profits can be freely repatriated to the home country. Furthermore, foreigners can acquire apartments, houses, commercial buildings, or building plots without specific quotas, subject to some restrictions on agricultural and forest land.
The legal framework for transactions is presented as comparable to that of France or other Western European countries, with a reliable cadastre, a centralized land register, and the mandatory involvement of a notary.
Finally, Latvia is one of the EU countries where overall taxation remains relatively moderate: no wealth tax, advantageous taxation for companies that reinvest their profits, and targeted taxation on income that is actually distributed or generated locally.
Cost of living and appeal for expatriates
For an expatriate, the comparison with France is telling. The cost of living is significantly lower:
– Living in Latvia is on average 37% cheaper than in France;
– However, local purchasing power is about 48% lower than in France, which explains proportionally lower real estate prices and rents;
– In the capital Riga, the cost of living is estimated to be about 20% cheaper than in a large French city, including housing and transport.
For an expatriate paid in a strong currency or from a high-salary country, the exchange rate and cost-of-living differential clearly favors a real estate investment in Latvia, especially for renting to locals, expatriates, or tourists.
English is very widely spoken, especially in Riga and larger cities, which significantly simplifies procedures for non-Latvian speakers. Russian is also common. This linguistic dimension carries considerable weight for property management, communication with banks, notaries, or government agencies.
Overview of the Latvian real estate market
The Latvian real estate market is often described as having reached a certain maturity: we are far from the post-2008–2010 crisis chaos, and the sharp increases of the recovery years have given way to more measured growth. For an expatriate, this means a less speculative but more transparent market.
Price levels by area
Riga concentrates most of the residential and commercial real estate activity. Available figures show significant variations depending on the neighborhood and the age of the buildings.
Notably, we find the following ranges:
| Area / City | Indicative price per m² (apartments) |
|---|---|
| Riga – existing (older stock) | €700 to €1,500 |
| Riga – general average | €1,600 to €2,600 |
| Riga – Center & Vecrīga | €1,800 to €4,700 |
| Riga – Ķīpsala | €1,500 to €3,500 |
| Jurmala (apartments) | €1,500 to €3,000 (up to ~€3,000/m² on the waterfront) |
| Other mid-sized cities | €800 to €1,500 |
| Daugavpils (inexpensive city) | €400 to €1,000 |
These ranges overlap with several statistics: some sources mention an average price in Riga around €1,600/m², others around €2,600/m², which is explained by the difference between older housing in the suburbs and high-end new developments in the very center.
To illustrate this “wide gap”:
The price per square meter below which an older apartment on the outskirts can be negotiated.
In Jurmala, a chic seaside resort about 25 km from Riga, average prices per m² are higher than in the capital, especially closest to the 33 kilometers of beach. Waterfront apartments can thus reach €3,000/m², with 300 m² villas ranging between €300,000 and €350,000.
In secondary cities (Sigulda, Cēsis, Liepāja, Daugavpils), prices drop significantly, with floors around €400 to €800/m² in the least pressured areas. There are even modest houses in the provinces for around €13,000 to €17,000 for 40–50 m².
Concrete examples of properties
Several practical cases help to illustrate the price/quality ratio:
| Example property | Location | Surface area | Stated price |
|---|---|---|---|
| 4-room apartment, 120 m² | Riga | 120 m² | ~€160,000 |
| Quality apartment, 110 m² (nice neighborhood) | Riga | 110 m² | ~€250,000 |
| Decent 2-bedroom apartment | Riga | N/A | <€150,000 |
| 30 m² studio for seasonal rental | Riga/Jurmala | 30 m² | ~€50,000 |
For comparison, €250,000 buys about 20–30 m² in Paris, compared to a nice 100 m² to 120 m² apartment in a sought-after neighborhood of Riga or a comfortable seaside home in Jurmala.
The Latvian real estate market is estimated to be on average 60 to 65% cheaper than the French residential market.
Price dynamics
In 2022, apartments in Riga experienced an impressive increase of about 17.9%, with the average price at that time around €967/m² for certain segments. Across the country, an annual increase of about 11% was even cited, making it one of the highest increases in the European Union at that time.
This movement occurred in a context of soaring inflation, followed by monetary tightening. Now, with inflation back to around 2–3%, prices seem to be evolving in a more controlled manner, even if demand remains strong in certain niches: new housing, renovated apartments in central Riga, tourist properties in Jurmala.
Rental market: actual yields and types of demand
For an expatriate investor, the appeal of the Latvian market is primarily measured by rental yield, both long-term and seasonal.
Rent levels
In Riga, several data points converge:
– The average rent for a two-bedroom apartment in the best neighborhoods is around €600–€605 per month;
– For a three-room apartment, rents often vary between €650 and €1,000 depending on the season, exact location, and condition of the property;
– The average rent per m² is estimated at around €7–€9/month, exceeding €10/m² in high-end new residences.
Nationally, rents remain on average about 45% lower than in France, following the same logic as purchase prices. But the differential remains interesting for a foreign investor, especially if financing is optimized.
The structure of demand is fairly clear: The structure of demand is fairly clear.
Overview of the most dynamic rental segments and areas under pressure in Latvia, revealing targeted investment opportunities.
Strong rental demand for recent or well-renovated 2- and 3-room apartments in the capital, Riga.
Sustained demand for shared housing and small studios in major university cities: Riga, Daugavpils, and Liepāja.
Strong appetite for seasonal rentals in Jurmala, Sigulda, and Riga’s historic center, due to a structural deficit of hotel supply.
Observed gross yields
Combining purchase prices and rents, several gross yield estimates emerge:
| Location / Type | Estimated gross yield |
|---|---|
| Riga (apartments) | 4% to 6% |
| Riga (small properties) | ≈ 5.2% |
| Jurmala (seasonal) | 6% to 9% (up to >10% in high season) |
| Regional cities | 5% to 7% |
| 30 m² seasonal studio | ≈ 5.28% |
A practical example from the data well illustrates the order of magnitude:
– Purchase of an apartment for €120,000 in Riga;
– Additional costs (notary, furniture, etc.): €30,000;
– Monthly rent: €850;
– Gross annual income: €10,200;
– Gross yield on total capital (€150,000): ~6.8%;
– Estimated net yield after charges, vacancy, and management: 5.5% to 6%.
Another scenario:
– Purchase of a two-bedroom apartment for under €150,000;
– Possible rent between €630 and €800 per month;
– Gross yield around 5% depending on occupancy.
Or yet:
– 30 m² studio bought for €50,000;
– Seasonal rental;
– Gross yield of about 5.28%.
Some studies indicate that the average gross yield for real estate in Latvia is about 6.64% nationally. This yield is considered quite favorable compared to France (around 4%), Belgium, or several Southern European countries.
Tenant profile
Properties intended for long-term rental primarily target:
– Young Latvian professionals, often employed in services, finance, or technology;
– Students, particularly in university cities;
– Expatriates working in Riga (institutions, international companies, tech startups);
– Local families looking for renovated 3- or 4-room apartments.
On the seasonal segment (Airbnb, Booking, etc.), the clientele is varied:
– European tourists, including an increasing number of affluent visitors;
– Business travelers and digital nomads, attracted by the cost of living and Riga’s tech ecosystem;
– Beach vacationers in Jurmala in summer, with nightly rates ranging from €20 to €60 depending on standards and period.
The absence of true hotel saturation in certain Riga districts and along the coast strongly favors the profitability of well-managed tourist rentals.
Real estate taxation in Latvia for expatriates
Latvian taxation is one of the major arguments for an expatriate investor. It stands out for the absence of certain taxes and a relatively simple structure.
Wealth and property taxes
Latvia levies no wealth tax or solidarity contribution on assets. This is an important point for expatriates heavily exposed to the IFI (French wealth tax) or other wealth taxes in their home country.
However, owning real estate incurs an annual property tax, calculated on the cadastral value, which is generally lower than the market value. Ranges vary by source and municipality, but the following benchmarks are found:
| Tax / Fee | Indicative level |
|---|---|
| Transfer tax (acquisition) | 2% of price or cadastral value (capped) |
| Annual property tax | 0.2% to 0.6% (or up to 1.5–3% depending on type and municipality) |
Most sources indicate for standard housing a rate between 0.2% and 0.6%. Some municipalities have adjustment margins, particularly for commercial premises.
Rental income
Taxation of rents in Latvia remains competitive, especially for non-residents, who are only taxed on their Latvian-source income.
Two main frameworks appear in the data:
– A flat-rate taxation regime for rental income at around 10%;
– A single-rate regime of 23% on certain income, with the prospect of a possible reduction to 18–20%.
Investors typically opt for the most advantageous scheme, limiting the payment to a moderate fraction of rents. The precise choice (gross or net regime, applicable deductions, deductible expenses) depends on the legal structure chosen, the expatriate’s tax residency, and the provisions of the applicable double tax treaty.
Regarding personal income tax, Latvia applies progressive rates of 20%, 23%, and 31% for its residents, depending on brackets. But as long as the expatriate is a non-resident under Latvian rules (stay of less than 183 days per year) and only receives rents from properties in Latvia, they are taxed only on those rents, according to the specific rental income regime.
Furthermore, the France-Latvia tax treaty (signed in 1997, effective since 2001) prevents double taxation. It notably provides:
– A clear allocation of the right to tax certain income between the two countries;
– Special rules for interest and royalties: in some cases, this income is only taxable in the country of residence of the beneficial owner.
A French expatriate investing in Latvia must declare their foreign income in France using form 2047. It is also crucial to consult a specialist advisor to understand the application of tax credits provided for by the tax treaty between the two countries.
Capital gains on real estate
For non-residents, capital gains from the sale of Latvian properties are subject to withholding tax. The report mentions several mechanisms:
– A specific withholding of 3% for non-residents on the sale proceeds in some cases;
– A fixed-rate capital gains tax of 20%, potentially up to about 31% in certain scenarios, with possible exemption if the property has been held long enough (e.g., more than 60 months) or if it is the primary residence.
In practice, it is essential to have your situation analyzed by a tax specialist, especially if you plan frequent portfolio turnover (quick buy-sell) rather than long-term holding.
Corporate taxation
Latvia also offers an attractive regime for investments through a company:
– The corporate income tax rate is set at 20%;
– But profits reinvested in the company are not taxed (0% rate on reinvested profits);
– Only distributed profits (dividends) are subject to CIT at an effective rate of 20% (calculated as 20/80 on the net dividend).
For an expatriate who wishes to structure a Latvian rental portfolio through a local company, this mechanism allows capitalizing profits without tax friction as long as no distribution is made.
VAT and transaction costs
The standard VAT in Latvia is 21%, with a reduced rate of 12% for certain goods and services, and a rate of 0% in specific cases. For real estate:
– New buildings sold by a developer are generally subject to VAT (about 21%);
– Resales of older properties between individuals generally do not incur VAT, but only registration fees and transfer tax of around 2%.
Maximum estimated percentage of transaction costs (taxes, notary, and administrative fees) relative to the purchase price, a competitive level in Europe.
A summary breakdown of the main fees upon acquisition looks like this:
| Cost item | Order of magnitude |
|---|---|
| Registration / transfer duty | 2% of price or cadastral value (capped) |
| Notary fees | ~1% (often between €70 and €300–800 for the deed) |
| Cadastre / register fees | A few dozen euros (≈ €14–€20) |
| Agency fees (often seller’s responsibility) | 2% to 5% of price (negotiable) |
| Property valuation | €100 to €200 |
| Bank escrow account (if applicable) | ≈ 0.4% of price |
For an expatriate, the “friction” cost of entry is therefore relatively limited compared to other popular European markets.
Financing: borrowing in Latvia as a non-resident
Latvian banks can grant real estate loans to foreigners, but conditions vary widely depending on the profile and residency.
Usual guidelines are as follows:
Main conditions and criteria for obtaining a mortgage in Latvia, applicable to residents and non-residents.
Mortgage rates generally range between 3% and 6% per annum, depending on the economic period and the borrower’s profile, following eurozone trends.
The loan is generally granted up to 70-75% of the property value for a resident. For a non-resident, this percentage tends to be 60 to 70%.
A significant down payment is required, especially for an expatriate, typically around 30% to 40% of the property value.
Solvency is strictly verified, with a debt-to-income ratio generally not exceeding about 40% of the borrower’s net income.
In practice, many foreign investors prefer either to pay in cash, or to finance from their country of residence (e.g., through a French bank), or to combine local financing with equity.
The credit file must be documented, often in Latvian or English: income proof, bank history, employment contracts, etc. For expatriates from outside the EU or from countries considered high-risk, additional guarantees may be required.
The residence-by-investment program: the Latvian “Golden Visa”
For a non-European expatriate, Latvia has long been talked about for its residence-by-investment program, often referred to as a “Golden Visa”. This scheme remains central to the strategy of some real estate investors.
General principle
Introduced in 2010, the program allows a national of a third country (outside EU, EEA, Switzerland) to obtain a temporary Latvian residence permit, valid for five years and renewable, in exchange for an economic investment in the country.
Several options are available:
– Real estate purchase;
– Investment in a Latvian company;
– Large bank deposit;
– Subscription to government bonds or subordinated bank capital.
The strength of the scheme lies in the fact that: the synergy between the different elements creates a high-performing dynamic.
Main strengths and favorable conditions of the residence-by-investment program in Latvia.
The investment threshold is relatively low compared to other European programs.
No continuous residency obligation. A minimum presence of one day per year in Latvia is sufficient to maintain the permit.
Spouses and minor children can be included in the application.
The residence permit obtained allows free movement within the entire Schengen Area.
Real estate investment and residence
The real estate variant works on a simple basis:
– Purchase of a property (residential or commercial) with a minimum value of €250,000;
– The property must be located outside Riga and its immediate periphery for this specific program;
– The cadastral value must reach a certain threshold (at least €80,000 in some schemes);
– It is forbidden to buy agricultural or forest land under this scheme;
– Payment must be made by bank transfer, not in cash;
– The property must be held for at least five years.
In addition to the property price, the investor must pay a state fee equal to 5% of the property’s value. For the minimum threshold of €250,000, this amounts to €12,500.
After an investment and submission of a complete dossier, the administration processes the application in an average of 2 to 3 months. If accepted, a temporary residence permit valid for 5 years is issued. It is renewable without a new capital injection, provided the investment is maintained and the ongoing conditions are met (health insurance, means of subsistence, clean criminal record, etc.).
After five years of permanent residence (which this time requires significant physical presence of about 183 days per year), it becomes possible to apply for permanent resident status. Ten years after the start of legal stay, naturalization may be considered, subject to passing language and civic knowledge tests.
Other investment routes for residence
In addition to real estate purchase, several “business” options exist:
Minimum amount in euros to invest in Latvian government bonds to benefit from a residence program, despite a zero interest rate.
Overall, the real estate formula remains one of the most affordable on a European scale for obtaining residence in an EU and Schengen member country, at the cost of a €250,000 ticket.
What the Golden Visa allows (and does not allow)
It is essential to remember that purchasing a property, outside the strict framework of this program, does not automatically grant a residence permit. The Golden Visa is a separate scheme with specific criteria and files.
However, once residence is obtained:
– The holder can live, work, and study in Latvia;
– They can travel freely within the Schengen Area for short stays;
– They and their family have access to Latvian public services, including education (free up to university) and the healthcare system.
For an expatriate with a European residence project but no immediate desire to settle in France, the “rental investment + Golden Visa” combination can thus be a strategy to consider.
Legal framework, procedures, and transaction security
Legal security is a central point when buying abroad. In Latvia, the sales process follows a fairly standardized pattern, with some specificities.
Main steps of a purchase
Generally speaking, a real estate acquisition in Latvia follows these steps:
Buying a property in Latvia follows a structured procedure. It begins with selecting the property via local agencies, online portals, or investor networks. Then, a reservation agreement or preliminary contract is signed, often with a deposit of 5 to 10%. Legal and technical checks on the property (title deed, charges, compliance) are mandatory. Funds can be secured through an escrow account. The final deed is signed before a notary, who authenticates the transaction and collects the taxes. The notary then proceeds with registration in the Land Register, transferring full ownership. The buyer pays the balance and costs, then receives the keys.
The role of the notary is more limited than in France in some respects (they are not necessarily your exclusive advisor), hence the importance of hiring an independent lawyer, especially if you are buying remotely or through a company structure.
Specific documents and constraints
The foreign buyer will generally need to: research local regulations regarding import and export, ensure product compliance with local standards, and study payment and shipping options.
To invest in real estate in Latvia, you need to obtain a local identification number (Personas kods), open a Latvian bank account to manage financial transactions and rents, and prepare certified identity documents, sometimes accompanied by a translation into Latvian or English.
For certain types of land (agricultural, forest), authorization from the Ministry of Agriculture or local authorities is required, especially for non-EU nationals.
It is also essential to justify the source of funds: Latvian banks apply anti-money laundering checks (TRAFIN), with increased scrutiny on international transfers.
Comparison with other European destinations
Several comparative studies highlight that the best gross rental yields in Europe are often found in Central or Eastern Europe. Latvia regularly appears in the leading pack, but often just behind Lithuania, Hungary, or some Balkan markets.
A comparative table of average gross yields mentions for example:
| Country / City | Indicative gross yield |
|---|---|
| Lithuania | 7.81% |
| Poland | 6.88% |
| Latvia | 6.64% |
| Romania | 6.16% |
| France | ~4% |
| Belgium | ~4.2% |
In another comparison focused on a few European capitals or major cities:
| City | Average price €/m² | Average monthly rent | Gross yield |
|---|---|---|---|
| Riga (Latvia) | ~€1,800 | ~€850 | ~8.4% (specific case cited) |
| Podgorica (Montenegro) | €1,400 | €800 | 6.7% |
| Warsaw (Poland) | €2,300 | €1,200 | 6.3% |
| Madrid (Spain) | €4,000 | €1,600 | 4.8% |
| Brussels (Belgium) | €3,700 | €1,400 | 4.5% |
Latvia thus ranks among the European markets offering an interesting “entry price / yield” combination, especially compared to France or Belgium, where gross yields are around 4% with a heavier tax burden.
Risks and limitations of an investment in Latvia
Despite its advantages, the Latvian market is not without risks, and some observers even believe that the most attractive phase in terms of yield is already over.
Among the factors to watch:
The market shows maturity with limited upside potential, particularly in city centers. Outside Riga and Jurmala, demand is fragile with risks of vacancy and low liquidity. The regulatory environment (taxation, Golden Visa) could change unfavorably. The economy is exposed to the European context and regional tensions. Finally, the language barrier requires using translators and local advisors for administrative and legal procedures.
Finally, it is important to avoid a frequent mistake: confusing property purchase with an automatic residence permit. Without explicitly subscribing to the residence-by-investment program and meeting its criteria, an expatriate remains a simple investor without any special long-stay rights.
Possible strategies for an expatriate investor
Depending on your profile, several strategies can be considered.
An expatriate seeking pure yield will often favor:
– A mid-sized apartment (2-room/3-room) in a dynamic district of Riga with strong rental demand;
– or A small portfolio of furnished studios for students and young professionals, near universities and employment hubs.
An investor more focused on capital appreciation and wealth growth may target:
– Riga’s historic center (Vecrīga), Art Nouveau districts, and high-end new residences;
– Certain areas undergoing redevelopment (former residential neighborhoods transformed into leisure or office zones);
– Projects on the coast, particularly in Jurmala, where tourist land pressure remains strong.
The Golden Visa program allows obtaining a residence permit in the European Union through an investment. It is an option to consider for people seeking to settle in the EU via this type of scheme.
– Acquisition outside Riga for €250,000, combined with a seasonal or long-term rental project;
– or Investment in a local company, particularly in tech, combining professional activity and tax optimization (reinvested profits not subject to CIT).
Finally, very cautious expatriates may choose to diversify their exposure to Latvian real estate through pan-European collective vehicles (European SCPIs including Latvia or the Baltic region), even if most products cited in comparisons remain focused on Germany, Poland, Ireland, or Spain. This type of solution pools risks, but with slightly lower returns and less bank leverage.
Conclusion: who is Latvia really interesting for?
Latvia offers a fairly rare combination in Europe: still reasonable prices per square meter, rental yields often higher than in Western Europe, moderate taxation, an attractive residence program for non-Europeans, and full membership in the EU and Schengen.
For a French-speaking expatriate, this market can be particularly relevant if:
This advice is aimed at investors seeking a compromise between yield and legal security within the EU, who are willing to collaborate with local professionals (lawyer, agent, notary, translator) to secure each step of the investment, who adopt a long-term holding strategy rather than a short-term speculative approach, and who understand the tax implications in their country of residence and in France, optimizing the application of the double tax treaty.
Conversely, if you are solely looking for quick capital gains or a completely “turnkey” product without involvement, other markets or collective investment vehicles such as European real estate funds may be more suitable.
Investing in Latvia means accepting a less “standardized” environment than that of major Western European metropolises, but potentially more rewarding, provided you follow a strict discipline: detailed analysis of neighborhoods, rents, tax rules, and systematic use of proper legal and technical due diligence before signing. For an expatriate who knows how to surround themselves with the right advisors, it is a playground where real estate remains affordable, in a European country that hasn’t said its last word on the real estate scene.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
