Cold War Continues in the Real Estate Aftermarket
While last year it was expected that soon it would be possible to buy real estate cheaply due to struggling clients and loans turning sour, in reality this has not happened except in individual cases, comments on the market situation Egon Juhanson, a real estate broker at Elum Kinnisvara.
"It's like a cold war," says Juhanson. "Buyers are waiting for a major drop in the secondary market, but sellers don't see a reason for it." Prices have certainly already fallen, but they have remained within the general market conditions. For something drastic to happen, sellers would need to be forced to realize their real estate quickly.
"Currently, sellers are rather waiting for better times and paying utility bills for empty apartments," says the broker.
The Right Price Matters
According to Egon Juhanson, it is currently most difficult to sell so-called average apartments that do not directly require renovation, but still require investment for updates. There are also the most of these apartments on offer, and you can certainly expect further price drops in this segment.
The best-selling apartments on the secondary market continue to be those requiring renovation and renovated apartments at the right price. Interested buyers include both private individuals and investors placing capital.
Speaking about prices, the Elum broker says that for example in Tallinn suburbs, the best-selling apartments are two-room apartments requiring renovation priced at 80,000 – 90,000 euros and the same-sized renovated apartments priced at 115,000 – 125,000 euros.
"The message of the Euribor pause has generated some interest, but it is too early to talk about growth in transaction volumes. Purchases are still happening at a slow pace," Juhanson concludes.
