The average price per square meter for an apartment sold in Tallinn in December was €2,153, 11 percent higher than a year ago and an all-time high, according to 1Partner, a real estate agency based on transaction reviews. The prices set a new record for the third month in a row.
1Partner Property Manager Martin Vahter said the price is driven by the large share of new apartments on the market. "Last year, due to emotional attachments, several expensive end-of-life apartments were bought at a slightly higher price than the market value. Such purchases were generally made without a bank loan and with a buyer's own funds. This trend itself speaks volumes about the economy and the real estate market," Vahter said.
Vahter said last year was a repeat of 2018 in terms of the number of transactions, indicating a stabilization of demand in the market. "Together with the general economic well-being, a slight increase in the capital's real estate market is expected in the next year. But too higher prices are not really in anyone's interest, and as the economy cools down, prices should remain stable," Vahter predicts.
In the last month of the year, a total of 1,131 purchase and sale transactions were made for real estate in Tallinn. The total value of these transactions was €175 million, which is 13.4 percent more than in November and 27.4 percent more than in December 2018.
In December, 837 apartments were sold in Tallinn, which is 10.3 percent increase compared to December 2018. The average price per square meter rose 4.5 percent when compared to November and 11.2 percent year-on-year. The most expensive apartment was sold for €600,000 and the cheapest €1,000.
In December, 33 residential properties were built in Tallinn, which is five times more than in the previous month. The most expensive house was sold for €800,000 and the most cheapest for €100.
Last month, five plots of residential land were sold, six less than in November. The most expensive plot cost €270,000 and the cheapest was €35,000.
"Looking at current trends, an apartment in the capital is a good investment, no matter where it is located. Growth can be seen everywhere, and according to many real estate analysts, a steady year of growth is predicted," said Karin-Noppel Kokerov, head of City24.ee, a property website. "Earlier fears that predicted when new apartment buildings are built the Soviet-era districts will empty have not materialized."
The Land Board said the largest increase in the average price per square meter had been in small apartments sized between 30 and 41 square meters last year, amounting to nearly 10 percent or €1,980.
Editor: Helen Wright