Fear of inflation has increased interest in real estate

New apartment buildings.
New apartment buildings. Source: Siim Lõvi /ERR

Real estate developers admit that while they were waiting for a real estate crisis in the onset of the coronavirus pandemic, a fear of inflation has led the sector to go through a boom instead.

On a foggy winter Sunday, the cornerstone of a six-apartment villa development was placed in Pärnu. As of the development's location and project, the per-square meter price of the apartment's stands at around €4,000. But developers have no reason to fear that the extraordinary prices would scare buyers off as some of the apartments are already booked.

In Pärnu, more apartments were sold during 2020 than in any prior year. While the world is going through a crisis, money has not disappeared off and there is no crisis to speak of in real estate.

"The real estate sector, despite our predictions, has been very active since last spring. We trully were wrong when we thought this whole process would be reminiscent of the period 10-15 years ago. On the other hand, worries over the value of money and topics related to health have shown that people wish to live separately, more homely," said Ingmar Saksing, board member of LVM Kinnisvara.

Experts think that the confirmation of the Rail Baltic international railway project, Pärnu has become more of a real estate hotbed, as noted by Pärnu city council chairman Andrei Korobeinik (Center).


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Editor: Kristjan Kallaste

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