ABSTRACT
This chapter provides an overview of major housing reforms and their impact over the newly emerging market-based system in Latvia. It focuses on housing market performance in Riga, the capital city of Latvia. The chapter examines the process of ownership transformation with a particular emphasis on challenges and opportunities created by restitution and privatization. It also provides some suggestions for housing reforms to address the challenges in the post-privatization phase. The decentralization of major policy responsibilities to the local level is particularly problematic for smaller municipalities with limited sources of revenue and negligible amount of social housing stock. Housing reforms in Latvia during the transition period were marked by emphasis on privatization of state and municipal housing, reduction of supply and demand subsidies and deregulation of housing markets. While new households face affordability problems in the home ownership market, housing costs in the public/state rental sector appear to be modest.
