Dear clients and cooperation partners,
We have already commented on upcoming amendments to the Law On Residential Properties (Law) and expressed our opinion that the Law threatened development of housing fund construction. One of our suggestions was to improve the situation by immediate changes to the Law, in particular disapplying the new procedure (one residential building on one land plot) from construction plans that were lawfully started before the amendments came into force.
Recently (22 June), new amendments were introduced to the Law (which comes into force on 13 July) to confirm that the new procedure does not cover those residential buildings that received their construction permit before 31 December 2016. This means that projects launched by the end of last year and having at least a construction permit do not need to be re-worked, and developers can finish them by dividing several residential buildings located on one land plot into separate apartment properties.
Likewise the new procedure will not apply to those residential buildings that were recorded in the Land Register by 31 December 2016. This supplement to the Law will keep the door open for the old regulation for those building owners who have not managed to divide several buildings owned by them and located on a single land plot into apartment properties. This could be especially topical for owners of buildings in the centre of Riga regularly facing the situation that a joint property covers more than one residential building on one land plot.
The new amendments should be positively assessed. Moreover, we should appreciate that the legislator has been able to react promptly and eliminate defects. Nevertheless, the discussion about the new procedure in essence (namely, its negative effect on development of the housing fund and in the end also on availability of housing) is still open.