Houses in Helsinki's Lauttasaari, with Ruoholahti in the background. LEHTIKUVA


In recent times, the Finnish real estate market has shown intriguing statistical trends, particularly in terms of pricing. Data indicates a discernible shift in the housing market, with prices for used apartments in major cities like Helsinki, Espoo, and Tampere experiencing a slight decrease, reflecting a market adjustment post-COVID-19. Conversely, in smaller towns and rural areas, property prices have remained relatively stable, suggesting a consistent demand in these regions.

This bifurcation in pricing trends between urban and rural areas highlights the varying market dynamics across Finland. Just a couple of years ago, every newly build housing unit was already booked before completion and prices were so high you should have won in a Finnish casino to be able to afford an apartment in Helsinki. While the urban market is adjusting to post-pandemic realities with a slight price correction, the stability in rural areas underscores a sustained interest in less densely populated regions, possibly fueled by remote working trends and a growing appreciation for quieter living environments.

Amidst fluctuating global economic conditions, Finland's real estate market emerges as a beacon of opportunity. With a unique blend of market dynamics at play, now presents an opportune moment for potential property buyers. This article will delve into three compelling reasons why investing in Finnish real estate is a wise choice at this juncture.

1. Declining Interest Rates Signal Affordability
Danske Bank's projection suggests a decrease in market rates over the next two years, predicting the year-end Euribor to hover around 3% by the end of this year and near 2% by the end of 2025. Sari Takala, Head of Personal Customer Loans at Danske Bank, notes that this forecast, if realized, would significantly ease the monthly burden on borrowers. She advises considering diverting some of the savings from reduced loan installments to savings and investments. The lowered interest rates are set to make mortgage repayments more affordable, thereby increasing the attractiveness of real estate investments.

2. A Balanced Real Estate Market with Time for Consideration
The real estate market in Finland is experiencing a revival. However, unlike the rush of the COVID years, buyers now have more time to deliberate their decisions. The market shift benefits both first-time buyers and those looking to change homes. Takala emphasizes the importance of considering the condition and repair history of properties before purchase. This increased breathing room in decision-making, combined with a lively market typically seen in spring, suggests a favorable environment for making informed real estate investments.

3. Advantageous Conditions for First-Time Homebuyers
Despite the removal of the exemption from the transfer tax for first-time homebuyers, the lowered transfer tax rates from 2% to 1.5% for apartment shares and from 4% to 3% for property transactions present a silver lining. Sari Takala points out that the current market situation is particularly beneficial for first-time buyers due to the decreased prices of properties. Additionally, Danske Bank's extension of benefits for first-time homebuyers, including waiving certain loan fees, adds further financial incentives.

In summary, the convergence of declining interest rates, a balanced real estate market offering more time for decision-making, and favorable conditions for first-time homebuyers make the Finnish real estate market an attractive investment opportunity at present.