KredEx will allocate €100 million for reconstruction of houses

Tallinn. Source: Siim Lõvi /ERR

KredEx will be announcing a new application form for reconstructing houses. Applications will be accepted for one month so that the apartment cooperatives could make the necessary preparations. The government separated €100 million with the supplementary budget for reconstructing houses. The exact terms of the subsidy will be set soon in the Ministry of Economic Affairs and Communications.

Association of Apartment Cooperatives was able to conduct a survey among the members before the supplementary budget was confirmed. 70 of the apartment cooperatives that answered the survey have already made necessary spendings for the reconstructions. A more thorough survey made a couple of years ago showed that the interest is there.

293 heads of the cooperatives answered the 2018 survey and they agreed on taking €124 million for the repairing of the apartments, member of the board of the Association of Apartment Cooperatives Urmas Mardi said.

"The cooperatives are really waiting for that measure. In the spring of 2019, when €19 million came to the market, the 50 cooperatives that received the money made their applications within a minute and a half," Mardi said.

From the €100 million supplementary budget, €70 million will be divided between apartments to repair, a couple of millions from that funding will be for repairing some private houses. The remaining €22 million will be allocated for a state loan to those cooperatives that are not granted a loan by a commercial bank to finance the remaining part of the KredEx grant due to the low market value.

As in the previous year, the support rate in the regions with the highest real estate value, Tallinn and Tartu, will remain at 30 percent. In the lowest value areas, the support rate is 50 percent of the price per square meter.

"In addition to the €70 million coming from the help package, there´s €28,5 million coming from the European Union's Structural Funds," the Head of the Construction and Housing Department of the Ministry of Economic Affairs and Communications Ivo Jaanisoo said.

"And then there is the part which is still being specified but about €10 million which is coming from the sales of the emission allowances of CO2. This has to be spent as quickly as possible, the construction market needs to be kept alive. In the situation where the private sector is not investing enough - this is the reason we are speaking about one to two, in the extreme case three years," Jaanisoo said.

The measure excludes the construction of rental houses. About 400 apartment buildings could be repaired with the subsidy. In 30 years, 14,000 apartment buildings should be reconstructed.


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Editor: Roberta Vaino

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