In the past years and in the first half of this year ee24.com portal closely watched Latvia earning on those who wanted to buy expensive real estate in order to obtain a residence permit in the country. What a disappointment awaited for potential investors at the end of the year, when parliament decided to close the channel of so much-needed cash infusion in Latvia.
Recall that guaranteed residence permit in Latvia for buying real estate is cheaper than in other EU countries. When buying a property worth about €142,000 in Riga or €71,000 in provincial cities, you can go for obtaining a residence permit in Latvia, which, incidentally, does not necessarily confirm a permanent residence in the country.
At an average cost of apartments in Riga €1,000 per sq.m, it is obvious that for a residence permit foreigners acquire either spacious apartments on the outskirts or small luxury apartments in the center. In general, they spend on housing more than Latvians themselves, promoting the construction and related industries.
By the summer of 2013, for 36 months of the work of the program granting a residence permit when buying real estate, Latvia issued 6500 documents and attracted €570 million. Every month a new resident in Latvia spent €2,400.
However, the program is beneficial not only in money. There is another aspect that will impact positively in the long term. According to the President of Latvia Andris Berzins, it is a matter of national interest. It's about demographics. In 1989, 2,670,000 people lived in Latvia, in 2000 - 2.37 million, and in 2012 - only 2.04 million.
Who is less painful for the Latvian society, that will help to reverse this trend, if not the friendly Russians? They became the leaders at the request of a residence permit in the past 2013. Since the beginning of the year to October, almost two thousand Russian citizens appealed to the Latvian authorities with a request for a residence permit. Besides them, 300 Chinese citizens expressed the same desire.
But MPs before the election were not required to provide long-term benefit for Latvia, but the short-term benefits for themselves. In this connection, in recent months, the portal ee24.com constantly watched, as all the amendments to the Immigration Act were adopted, according to which the minimum amount of purchasing property of €142,000 was distributed not only in Riga, but the whole Latvia. A quota issuing residence permits was also introduced: 800 permits in 2014, and even less in 2015 and 2016.
Latvian President vetoed the amendments to the law, and so the next year the old rules will apply. For how long?
Expert's opinion of ee24.com portal
Karlen Kalashyan, CEO of the Latvian real estate agency Property Selection:
"You could say that the question of national unity and persecution of the "Russian occupiers" have always been the favorite tool of some Latvian parties. And, of course, these parties could not pass the law on obtaining a residence permit in Latvia. It is hoped that this card has already been played, and the question of strictening of the rules on the issuance of residence permit will not be raised in the near future.
Most Latvians do not consider the foreign investors as invaders. Rather, they see them as the engine of the national economy. In fact, buying property and getting a residence permit, many foreigners are beginning to translate their business in Europe. Given the lack of a language barrier, the presence of a developed banking and transparent taxation system, Latvia is an ideal country for such integration.
Many people start with investments in "golden visa", and end with a full relocation. Our fellow citizens want to live in a state of law and feel safe. If Latvia curtail the program, it may adversely affect the economic condition of the country. Moreover, it will affect the welfare of the citizens of Latvia. Many professions are currently closely connected with this program. But the amendments have not been adopted, and, hopefully, will not be accepted."