Estonian Real Estate at Its Most Expensive Level in History

Estonian real estate prices are at historic highs – the average transaction price for apartments in 17 major cities rose by 7.8% in June and remained at a record level of 1544 €/m².

Peep Sooman, a member of the board of Pindi Kinnisvara, said that the Estonian real estate market is currently full of paradoxes. "Activity in smaller towns is low, and the secondary market in Tallinn and Tartu is certainly not having its best days either, but the appetite of young families for new apartments is driving up transaction prices in larger cities," he said.

"The number of residential property transactions is in a slight downward trend, yet prices continue to rise, liquidity in commercial properties is low. This doesn't inspire much confidence in the market as a whole," said Sooman. "The real estate market could ideally be like a four-wheel drive vehicle where all wheels are pulling, currently it's not even certain that there's more than one wheel pulling," he added.

In May, the Pindi Index, which tracks the average price of apartments, was at 1432 €/m² based on corrected data. While 1420 apartment ownership transactions were made in the index cities in May, in June the number of transactions was 1257.

For comparison – in June 2018, 1404 apartment ownership transactions were made in the index cities.

Compared to the previous price peak in December 2018, the index is 1.4 percent higher. Compared to the lowest point in the past years in July 2009 (624.2 €/m²), the Pindi Index is 147 percent higher.

The price index compiled by Pindi Kinnisvara takes into account the weighted average price per square meter of apartment ownership purchase and sale transactions made in all county centers, as well as in Kohtla-Järve and Narva. This is a value that covers the living space of over 800,000 residents through more than ten years of history.

Article source: Pindi Kinnisvara