Increasingly More Apartments Are Being Purchased for Students in University Towns.

More apartments are being purchased for students in university towns

80% of apartment buyers in March were parents

The real estate market is experiencing an active hunt for good apartments. Alongside the capital, Tartu's market stands out with unusual activity. Compared to previous years, there are many parents among apartment seekers who are looking for apartments for young people entering university.

According to Scandium Real Estate statistics, in March, 80% of those involved in transactions in Tartu purchased apartments for young people starting or already studying at university. Buying an apartment is seen as an opportunity to invest in real estate and a sensible way to place money. At the same time, it solves the concern about a child's residence throughout the entire study period. After studies are completed, the apartment is planned to be rented out or the investment is to be exited.

Maia Lõško, Sales Director at Scandium Real Estate: "More and more parents find it reasonable to buy an apartment rather than renting. It is expected that a child will spend at least three, but rather five or more years at university. Rental payments for such a period would amount to tens of thousands of euros. When purchasing an apartment, this sum is directed toward acquiring real estate instead of going into someone else's pocket. After completing their studies, the plan is to rent out the apartment to the next student, taking advantage of Tartu's rental market advantages."

In terms of apartment type, one to two-room apartments in new buildings as close to the university as possible are preferred. Loft-type apartments are popular, where a compact space efficiently accommodates a bedroom and study area, kitchen, and bathroom. If the building has additional amenities such as secure bike storage, gym facilities, or entertainment options, these are only beneficial.

"A recent trend has also been that two or more apartments are purchased in the same building at once. One is provided for the child to live in, and another is rented out immediately. This way, the rental income from one apartment helps pay the mortgage on both apartments," commented Lõško.

"At the same time, down payments have increased significantly, and apartment buyers are eager to move into a transaction quickly. There is concern that good apartments will sell quickly and by autumn, when pension step funds become available, good options will have disappeared from the market and prices will be higher," Lõško summed up the situation in the university town real estate market.

 

Source: Scandium

Scandium Real Estate is a professional rental real estate developer based on Estonian capital. Our focus is on creating productive and modern rental real estate exactly where it is most needed right now. In short – we develop better quality of life.