The property market regained momentum in June, but an increasing number of homebuyers are looking for new homes outside the capital, as rising prices in recent years have pushed the cost of new developments in central Tallinn beyond the reach of many families, according to Everaus Kinnisvara’s latest statistics.
Everaus Kinnisvara’s June sales figures suggest that this summer is shaping up to be an active period for the property market, following a spring when many people postponed plans to move or purchase a new home. Compared to the average monthly transaction volume so far this year, the number of deals has more than tripled.
“People are no longer taking a wait-and-see approach, and we can see that consumer confidence is gradually returning. The conflict between the US and Iran, along with the situation in the Strait of Hormuz, significantly weakened confidence this spring, which also affected homebuying decisions. However, growing optimism about a resolution and this week’s announcement that the US and Iran are expected to sign a peace agreement on Friday will certainly give the summer property market a boost,” said Janar Muttik, Member of the Management Board at Everaus Kinnisvara.
According to Muttik, a clear trend is emerging in the housing market in Tallinn and its surrounding municipalities: more and more buyers are searching for homes outside the capital because new developments in central Tallinn have become too expensive for the average homebuyer, prompting many to seek alternatives in the surrounding areas.
“Most transactions are still taking place in Tallinn’s residential districts, but someone looking to move out of an area such as Mustamäe has very limited options within the city and often has to move outside Tallinn. As prices in central Tallinn and other popular residential areas such as Nõmme and Pirita have reached levels that are too high for many buyers, people are increasingly finding homes that offer the right balance of price and quality in new developments on the outskirts of Tallinn,” Muttik explained.
In central Tallinn, the price of a new family apartment ranges from €6,000 to €10,000 per square metre, while similar homes on the outskirts of the city are available for €3,500 to €4,500 per square metre.
“Popular locations include areas such as Luige and Kangru, where residents benefit from well-developed local infrastructure while still enjoying fast and convenient connections to Tallinn. Some of the developments closest to the city have also become too expensive, meaning buyers are increasingly looking at the next ring of suburban locations to find the right solution,” Muttik added.
This trend has also encouraged developers to follow a model already common across the Nordic countries. Instead of building and selling residential properties first and gradually developing the surrounding environment afterwards, developers are increasingly creating complete communities from the outset, including roads, playgrounds, landscaping, kindergartens and shared community spaces alongside new homes.
Everaus Kinnisvara is one of Estonia’s most diversified residential and commercial property developers. Its portfolio includes apartment buildings, terraced houses, semi-detached homes, detached houses, office buildings, stock-office developments, warehouses, self-storage facilities, residential building plots and serviced apartments. Everaus Kinnisvara is the only real estate developer in Estonia whose completed residential developments have consistently received top recognition in national housing competitions. The company’s bonds are listed on the Nasdaq Tallinn First North market.
Further information:
Maria Varblane
Marketing and Sales Manager
Everaus Kinnisvara
Tel. +372 5333 2954
Email: maria@everaus.ee
