August Overview: Number and Price of Tallinn Real Estate Transactions Declined

In August, 931 real estate transactions were made in Tallinn, which is 10% less than in July. The average price per square meter of an apartment in the capital fell by 1.3% over the month to 2,301 euros, analyzes 1Partner, the largest real estate company in the Baltic states, based on Land Board statistics.

According to Martin Vahter, the market is feeling the new season and anticipation of the upcoming pension payments, but at least the statistics from viewing real estate advertisements in the first days of September do not show a significant jump. "Rather, the real estate market has calmed down compared to spring," said Vahter.

"Currently, for various reasons, there is more free money in circulation at the same time than ever before. The economy is growing, stock market rises and the IT boom have made many people wealthy, and in September approximately one billion euros will be paid out from the second pension pillar. We should not underestimate the combination of money printing and inflation fears either. A consumption rally is inevitable and a more rational part of that money will also reach the real estate market," said Vahter.

"We are unlikely to see such active trading again this year as we did in spring, because banks control lending and people's financial capacity quite strictly, fortunately. In real estate, people are mainly looking for a better home for themselves, and the incoming pension money may provide sufficient additional funds to gather the down payment together. Through crowdfunding and funds, part of the money also reaches the market as investments," said Vahter.

In August, 711 apartments were sold in Tallinn, which is 5.6% less than in July. The average price per square meter of an apartment fell by 1.3% over the month, but was 11 percent higher compared to August last year. The most expensive apartment in the capital was sold for 582,000 euros.

In August, 22 developed residential land properties were sold in Tallinn, which is 21 fewer than in the previous month. The most expensive house was sold in August for one million euros.

Last month, seven residential land plots were sold, which is nine fewer compared to July. The most expensive plot cost 1.85 million.