Expert: Spring Brought Noticeable Activity to Tallinn's New Development Sales
The sales pace of new developments in Tallinn has been quite modest for the past couple of years, but there has been a noticeable upturn over the last few months, said Martin Vahter, head of 1Partner Real Estate, commenting on the trends in April and May.
According to the head of 1Partner, 4,200 apartments were sold in Tallinn new developments at the peak in 2021, and the normal sales volume should be in the range of 2,000-2,200 new apartments per year. "Reaching this normal level will still take some time. Based on the first five months, one could forecast approximately 1,300-1,500 apartments for this year's sales, which is about one and a half times more compared to last year's 950," commented Martin Vahter.
According to Vahter, buyers are returning to the market, and one reason for this could be fear of impending price increases. "Unfortunately, nothing gets cheaper in the world, and the prices of recently launched new projects confirm this as well. This prompts people to make decisions faster and to choose among the current so-called shelf options," explained Vahter on the change in sentiment, and added that talk of price cuts moving in waves is rather a myth. "Those cases when someone has reduced prices with great fanfare have rather been developments whose pricing was too optimistic already at the stage of market entry, and ultimately the developer themselves acknowledges this," added the head of 1Partner.
"Looking in the rearview mirror, one can say that 2021 was a boom year for new developments, and we will not reach a comparable level anytime soon. New development sales never came to a complete standstill, but for a long time transactions took place almost exclusively through binding reservations made during the good old days," explained the head of 1Partner Real Estate, and added that compared to the recovery from the 2009 downturn, we are in a situation where several valuable areas have already been developed and no new projects are coming there. "Thus, in the city center or Nõmme, the choice will not become wider even as the market becomes more active," said Vahter.
