For the third consecutive quarter, Latvia has experienced an increase in construction activity. This year, the main driver of growth has been the more active construction of infrastructure projects.

In the first three quarters of this year, the volume of construction output was 8.9% higher than in the same period of 2024 (based on non-adjusted data at constant prices). In the third quarter, the increase reached 9.6% compared to the corresponding period of 2024. As in previous quarters, the main contribution came from more intensive construction of infrastructure projects.

There are differences in the pace of growth across the main construction groups. In 2025, the engine of the sector’s development has been civil engineering. It continued to grow rapidly, while building construction and specialized construction activities increased at a much slower pace. The volume of building construction rose by 5.0% in Q3 2025 compared to Q3 2024, with the multi-apartment residential segment being the main contributor to this positive trend.

Civil engineering maintained its position as the fastest-growing segment, recording a 22.4% increase during this period. Strong growth was observed across all civil engineering categories, with the largest contribution coming from road and railway construction.

The volume of specialized construction works was 3.4% higher than in Q3 2024. The growth was driven mainly by segments such as electrical installation, pipeline installation, and related activities.

In Q3 2025, 1,262 building permits were issued — 10.3% more than in the same period last year. A similar trend is visible in the total floor area, which increased by 31.4%, largely due to the construction of multi-apartment buildings as well as buildings for entertainment, education, and healthcare purposes.

The business sentiment indicator in the construction sector remained positive in Q3 2025. It is expected that the inflow of investments will continue to support the sector’s growth in the coming quarters.

Prepared by:
Analytical Service
Ministry of Economics of Latvia