State to allocate €366 million to apartment construction over five years

Tallinn's Lasnamäe District.
Tallinn's Lasnamäe District. Source: Priit Mürk/ERR

At the end of the summer this year, or in the autumn at the latest, a state aid program for the renovation and insulation of apartment buildings will be launched. The five-year program, based on EU funding, is worth €366 million and is expected to bring the heating costs of around 43,000 apartments under control.

The Minister of Economic Affairs and Infrastructure Taavi Aas (Center) said that the support program is large enough to continue for all those who want it, not only for the fastest applicants.

"The total funds for the next period are €366 million and we expect about 200 houses a year, €50-60 million a year. This is our support, plus the contribution of the housing associations, which in our vision will be different in the next period," Aas said.

The cost of insulating a house depends on the size of the house and how thoroughly the work is done.

"The specific apartment building, which we are currently insulating, will insulate the façade and carry out a partial exchange of opening fillings. It can be said that the budget is in the sum of €300,000. When we add the roof and roof insulation, then the sum is somewhere around €500,000," Andres Kaar, CEO of Estlander Group said.

"If we talk about the construction cost per square meter, then full reconstruction - replacement of all technical systems, windows, new balconies, in this case, can cost practically half of the construction cost of a new house," Kristjan Soomets, Member of the Management Board of construction firm Balti Vara Ehitus said.

The rate of state support is 30 to 50 percent, depending on the region. The launch of such a large-scale program will increase the burden on the construction market, which could mean problems with manpower and materials. However, Soomets stressed the positive effects of stability.

"Rather, this stability creates a sense of security for those who do the construction. At the moment, support has been fluctuating - a larger amount comes to the market, then it disappears again. Specialized workers will start looking for other options. When the support is stable, I don't think there will be problems with the workforce," he said.


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Editor: Roberta Vaino

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