Overview: It's Possible to Sell Successfully Even in a Quiet Real Estate Market

August was more active again in the apartment market, but price levels fell both in Estonia as a whole and in Tallinn. However, some apartments are selling very quickly.

Looking at the dynamics of purchasing activity, it is clear that interest in secondary market residential properties is growing. Successful transactions take place mainly at or below the value obtained through appraisal. Thus, price growth in cities has also stalled or is in a downward trend. We do see growth, however, where a larger number of previously reserved new development property purchase agreements enter the statistics, which on a smaller market can bring significant price growth. This happened, for example, in Tartu.

Special "strawberries" in Tallinn are renovated or very well-maintained two-room apartments in historic buildings priced up to 200,000 euros. People are looking for beauty, design, and high ceilings, and when something matching these parameters comes on the market, a successful transaction is a matter of hours or a few days.

The rental market has calmed down again and the number of listings began to grow in August. It is true that this is especially noticeable in the case of more expensive apartments. The market for more affordable rental apartments remains active and prices are also in a slight upward trend. Generally, larger price growth ends with the beginning of autumn, and toward the end of the year we see stabilization here as well.

Tallinn in decline

In August, 1,911 apartments were sold across Estonia (1,652 in July), with a median price per square meter of 2,038 euros. Compared to July, the price level fell 3.2% and 4.7% year-over-year. Compared to August 2022, 21.7% fewer apartments were sold, and a decline of this magnitude has been prevalent this year.

In Tallinn, 672 apartments were sold during August (649 in July) with a median price per square meter of 2,804 euros. Compared to July, the price level fell 3.7%, while year-over-year it rose 1.3%.

As mentioned earlier, new developments made the difference in the Tartu real estate market again. Thus, the number of apartments sold came to 203 (157 in July) and the median price per unit was 2,621 eur/m2. Compared to July, the price level rose 12.8% and 11.4% compared to August last year.

In Pärnu, 71 apartments were sold in August (51 in July) and the median price per square meter came to 1,823 euros. While the price level rose 17.1% compared to July, it rose 3.1% year-over-year. The summer capital also saw more new apartments enter transactions.

In Narva, 63 apartments changed hands in August (66 in July) with a median price per square meter of 495 euros. Compared to July, the price level fell 6.8% and 14.2% year-over-year.

Article author: Uus Maa Real Estate Bureau analyst Risto Vähi