Foreword

Across the OECD there is renewed interest in public investment in housing to help address affordability and quality issues. Limited housing investment is a challenge in Latvia. Latvian households record high rates of home ownership and spend, on average, less on housing than their OECD peers. But many Latvians live in ageing, low-quality dwellings and are unable to afford upgrading or moving to higher quality housing that better suits their needs.

A 2020 OECD review of housing affordability in Latvia, Policy Actions for Affordable Housing in Latvia, recommended that the Latvian authorities establish a dedicated funding instrument to boost investment in affordable housing. Latvia’s establishment of a Housing Affordability Fund in mid-2022 is thus a welcome development in line with the OECD assessment and recommendations.

This report presents the results of work to support the Latvian authorities in the establishment and development of the Housing Affordability Fund, aiming to enable the Fund to leave a lasting impact on the housing market through enhanced policy, funding and management tools. The work was carried out by the OECD, within the framework of the Technical Support Instrument of the European Union, in collaboration with the Directorate General for Structural Reform Support of the European Commission. It draws on the rich and diverse experiences of four peer countries in establishing and operating revolving fund schemes for affordable housing (Austria, Denmark, the Netherlands, and Slovenia), and also reflects findings from engagement with a range of stakeholders in the Latvian housing sector. The report contributes to the OECD Horizontal Project on Housing, a whole-of-organisation effort to help governments design more efficient and effective housing policy policies.