Stable and Strong Real Estate Market Paves the Way for Price Growth

Although April once again displayed its varied palette, Estonia's average air temperature was above normal, and a new monthly record was set – 27.8 degrees. The awakening spring and falling EURIBOR brought people to view real estate more actively than before, which was also reflected in the increased number of transactions. According to preliminary data, 1,734 apartment ownership purchase-sale transactions were concluded in Estonia, which was naturally the best result of this year, slightly exceeding the high activity of last year's April. For the fourth consecutive month, the median transaction price showed strong results, exceeding the same period last year by 5.3%. Behind the median price growth was largely an increase in the share of new developments – so far market participants have not observed significant price growth when comparing segments. The apartment ownership market turnover increased by 3.4% compared to the same period last year, and the single-family home market turnover increased by 13.4%. Due to the low comparison base, the number of apartment ownership market transactions for the first four months of this year has increased by 8.2%, median price by 7.0%, and transaction turnover by 16.2%. Various tax increases and last year's lively second half market are curbing this growth, but still we see a more active market this year compared to last year.

Tallinn's keyword remains stability, which sounds quite dull, but allows market participants to better predict object prices and sales periods. Looking more deeply, we see that on the new development market, previously completed apartments are running out, and this in turn has raised selling prices. Over the last two months, the median selling price of new developments has risen 4% compared to a year ago, while the number of transactions remains slightly above 100. The secondary market also remains active – in April, the median price fell 2.3% compared to the same time last year (2,858 €/m²), while the number of transactions increased by 7.2%. According to preliminary data, 742 transactions were concluded in April, which was naturally the best result of this year.

According to preliminary data, the number of transactions in Tartu fell more than 14% compared to last year, but here one must again account for the structure of transactions and additional transactions, which for Tartu is always significant. Due to a decrease in the share of new development transactions, the median price fell nearly 17% – in total, 137 transactions were concluded in April and the median price was 2,292 €/m². Market activity is still higher than last year, as evidenced by both new development market sales and this year's 5.6% growth in the number of transactions.

In Pärnu, 55 transactions were concluded in April, balancing out the active March result. Compared to the same time last year, the number of transactions increased by only 5, and the median transaction price was practically the same, remaining around 2,060 €/m². Compared to Tallinn and Tartu, Pärnu's market growth trajectory is gentler; the continued market growth expectations are also indicated by increased number of listings and listing prices.

Narva's market has moved very sluggishly due to large price growth in ancillary costs. In April, 54 transactions were concluded, which was 34% fewer than in the same period last year, and over the last 12 months this was the second or third worst result. The median transaction price has shown strong decline over the last five months – April's median transaction price – 430 €/m² – was nearly 17% lower compared to last year. In changed market conditions, the number of listings has increased, and the listing price, which is 2/3 higher than the transaction price, is also on a downward trend.