Latvia: Rising housing prices and energy costs projected

A recent survey by Luminor bank indicates that 71% of Latvian residents expect housing prices to rise in the near future, a significant increase from previous years. The sentiment is strongest among the 18-29 age demographic, with 79% anticipating price hikes. In Riga, 77% of respondents share this view. Market experts suggest that wage growth, increased housing supply, and favorable lending conditions are driving this trend, with potential price increases of 5-10% this year.

Separately, concerns regarding rising energy costs are emerging. Entrepreneur Ivars Auziņš has predicted a difficult winter, noting that increased energy prices will impact household budgets and overall inflation. While higher costs may increase tax revenues for the state through VAT and excise duties, there are concerns regarding how to protect low-income individuals from the financial burden. The shift in costs may lead to changes in consumer spending habits and a greater focus on energy and food conservation.