Support for the purchase of housing will be available to a wider range of families.

At the meeting of the Cabinet of Ministers on June 30, amendments to the regulations on state aid for the purchase or construction of residential premises were approved, significantly improving the provision of state aid for the purchase of housing for families with children and creating special support mechanisms specifically for families with many children. Altum. “Availability of housing that meets the requirements of modern life is one of the country’s priorities at the moment. The amendments to the housing guarantee program approved by the government today are yet another step towards this goal, which significantly improves the existing support mechanism – the program will become much more attractive to families with many children and families in which a child is still waiting, at the same time it will facilitate the remigration process, providing the opportunity to receive support for compatriots as well. who have decided to return to Latvia. The results of the program so far confirm its necessity and effectiveness – since the beginning of the program, support has been provided to more than 14,000 families, in which more than 18,000 children are growing up; the 25 million euros invested in the program from the state budget have created more than 900 million euros of investment in the Latvian economy,” emphasizes Minister of Economy Jānis Vitenbergs. It is important to remind that in mid-June this year, while presenting the results of the OECD study on housing affordability in Latvia, OECD Secretary General Anhels Gurija (Angel Gurría) pointed out that the availability of housing should be one of the priorities of the Latvian government, because in Latvia many people live in outdated housing and overcrowding. pregnancy, the amendments to the program envisage increasing the amount of the guarantee for families with four or more children to 30% of the loan. Within the framework of “Balsts”, families with many children are expected to receive a subsidy for the purchase of a home up to 12,000 euros, but no more than 50% of the total cost of purchasing a home. The new subsidy support mechanism was introduced so that a family with many children could afford a bigger or better home, as well as to shorten the time needed to accumulate the first payment. Larger families also need more time to save for a down payment, especially considering that a larger home is also needed. In order to help households with children, in which the family has grown after participating in the program and the need for a larger home has arisen, as well as to improve the mobility of households between the regions of Latvia, it will be possible to apply for housing purchase support again in the future. The regulations of the Cabinet of Ministers include the possibility for families to apply for the guarantee again no sooner than 3 years after the previously granted guarantee, if the number of dependent children has increased or pregnancy has occurred and the obligations of the previously granted guarantee have expired. At the same time, it is important to point out that the subsidy “Balsts” can only be received once. Also, the rules include support not only for families in which children have been born, but also in all those cases where the fact of pregnancy has been established and the child is still expected. The core of the demographic policy consists of financial support for families, compensating the additional costs they incur with the birth of children.

In order to develop and promote a state policy that supports families and promotes demography, from now on a person who has one or more children as a dependent and is pregnant or is pregnant with the first child will be able to apply for the guarantee, as well as the child’s father is entitled to apply for the guarantee or the father of the expected child. In order to ensure the possibility for families to determine a smaller amount of the guarantee themselves, the borrower will be able to determine the minimum amount of the guarantee himself, but not less than 10% of the loan amount. Therefore, in the future, the family, after evaluating their financial situation, will be able to choose a smaller guarantee amount, thus paying a lower commission. Along with the amendments to the regulations of the MK, a portfolio guarantee mechanism was introduced. The portfolio guarantee mechanism, which is a form of cooperation in which credit institutions and Altum implement the program, will ensure that the program is implemented even more efficiently in the future, reducing the amount of necessary state funding and at the same time processing loan applications faster. Currently, the multiplier of the program is 4, but the portfolio guarantee allows the multiplier to rise to at least 5, which means that with the same amount of the state budget for risk coverage, it will be possible to ensure access to financing for more households with children than before. In order to provide families with the opportunity to purchase a home that meets their needs, while taking into account the increase in construction costs and, accordingly, the final price of the home, the maximum threshold of the transaction amount has also been increased to 250,000 euros. In order to promote the renovation of the national housing stock, the amount of the state guarantee will be increased by 5% if the residential premises to be purchased correspond to the energy efficiency class of “A” buildings or are almost zero energy buildings.

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