In 2022, the Latvian Municipal Union decided to initiate a new mission “Smart municipalities on the road to climate neutrinos by 2030”. It is intended to follow the innovative model of the European Commission, where the management of the missions is intended to achieve concrete results in the European Union to reach the targets by 2030. According to the direction identified, each municipality should assess and develop action lines and directions to follow in the long-term, including development projects. The residential fund is significantly outdated in Latvia, which increases its maintenance costs and, without increasing household income, alters the prospects for its recovery. According to data provided by the Ministry of Economics, Latvia is experiencing a very slow recovery of the multi-apartment residential fund, with only 0.2% of the total number of apartments in Latvia. New multi-apartment residential houses are being constructed in Riga and near the city of Riga, are being renovated, but the situation outside the Riga area is completely different. To be able to develop a concept for the development of residential houses, research is being done: development of residential houses in Latvia and housing characteristics, demographic situation and employment in cities, requirements of town building regulations, possibilities of attracting financing from municipalities and Financial Institution Altum for real estate development and construction of new low-rent housing have been analyse, as well as an analysis of the urban SWOT analysis by identifying the lingering and contributing factors. The development of residential buildings is influenced by various factors - the demographic situation, the solvency of the population, regulatory enactments, the capacity of management companies and their financial indicators, as well as state and local government support. Latvia mainly uses European Union funds for the renovation of buildings, as well as funds from the state and local government budgets, as the population has low solvency. State and local government support is needed for the renovation and energy efficiency measures, improvement of construction works, as well as for the development of rental housing construction to be able to develop multi-apartment residential buildings in Latvian cities.