RIGA, July 7 (LETA) - Over the past three years, the volume of home loans issued by Luminor Bank in Latvia's regions has tripled, LETA was told at the bank.

Although mortgage lending remains concentrated in Riga and surrounding municipalities, where 78 percent of all new mortgages are issued, Latvia's regions also remain significant, as their share of the total number of transactions is 23 percent, on par with the Pieriga region. Compared to previous years, a slight increase has been observed in Jurmala and Ogre Municipality, while elsewhere the share, of loans remains generally stable.

Kaspars Sausais, Head of Housing Loans at Luminor Bank, notes that the beginningof this year confirms that people's interest in home purchases remains high. In the first quarter, an estimated 270 households per month purchased or built a home with financing from Luminor Bank. Compared to the same period last year, the volume of new home loans increased by 23 percent.

A significant portion of home loans is issued in Latvia's regions, and in line with overall market growth, the volume of housing loans issued in the regions has tripled over the past three years, exceeding 700 transactions. The average mortgage amount in Latvia's regions is EUR 104,000, while the average household income among borrowers of such loans is EUR 2,900. In 42 percent of cases, the loan is taken out for the purchase or construction of a family home.

Among regions outside Riga and municipalities around Riga, the strongest demand for home loans has been observed in Jurmala, Liepaja, and Ogre Municipality, according to the bank. In the municipalities of Jelgava, Sigulda, and Valmiera, residents' interest in purchasing a home with a bank loan remains stable. In contrast, in the municipalities of Daugavpils, Ventspils, Cesis, Jelgava, and Tukums, as well as in other municipalities, the number of home loans is relatively low.

The Pieriga region, which includes municipalities around the capital, accounts for the second-largest market share, or 23 percent of all loans, with locations such as Marupe, Ropazi, and Kekava being particularly high in demand.

Families are most likely to choose to live in Pieriga, with 60 percent of loans issued with a co-borrower. The average loan amount is approximately EUR 140,000, while the average household income is around EUR 3,800 per month. Increasingly, residents are primarily choosing more compact and energy-efficient homes; approximately 60 percent of Luminor Bank's customers planning to build a single-family home with the bank's financing are choosing factory-built wood-frame homes.

The floor area of newly built homes is also decreasing. While in 2021 it averaged 145 square meters, by last year it had decreased to 132 square meters. At the same time, there is a growing focus on outdoor spaces. The area of terraces and patios has increased from approximately 40 to 48 square meters over the past two years.

The Riga housing market is dominated by apartment purchases. Last year, one of the most popular choices among borrowers was a compact three-room apartment in a Series 602 project with an area of about 60 square meters. With the bank's support, residents most often purchase properties on the resale market, with apartments in standard-design buildings accounting for 31 percent of transactions. At the same time, new developments are playing an increasingly significant role, accounting for 27 percent of all homes purchased with support from Luminor Bank in 2025.