The apartment market in Tallinn is experiencing an unexpected rise in prices, with a forecasted increase of 5-10% this year. According to Sten Renar Subatšjus, the analysis chief at the real estate agency Uus Maa, this is primarily due to a decrease in the supply of apartments and an uptick in transaction volumes, surpassing the long-term average. While the number of transactions reached about 750 per month last year, which is significantly higher than the usual average, prices remained relatively stable.

With consumer confidence growing, along with rising wages, the elimination of tax loopholes is leading to increased disposable income for consumers, which is expected to be reflected in real estate prices this year. The average listing price of an apartment in Tallinn saw an increase of nearly 8% over the past year, even as the number of active listings dropped by over 5%. This suggests that potential buyers are recognizing that prices are unlikely to decrease, prompting them to make purchase decisions more swiftly.

Despite the rise in prices, the selling period for new developments is extending to nearly two years, indicating a complex market landscape where demand is responding to various economic factors. As the market adapts to these changes, the real estate dynamics in Tallinn could continue to evolve, influenced by consumer behavior and broader economic trends.