As a result of privatization, most living spaces went to individuals and that’s why there are very few city-owned properties in Estonia. An Estonian usually owns his or her residence and the number of renters is small, especially outside the major towns. Many families dream of living in their own houses and during the economic boom of 2006-2007 these dreams were actively pursued. As real estate prices had been rising until the spring of 2007, it was thought that a piece of land was the best investment, preferably located by the sea, on an island or in some other place surrounded by beautiful nature.
But, by the spring of 2007, general optimism and favorable opportunities to get a loan had led to real estate prices so high that potential buyers lost interest in buying, as well as the money to buy. Prices started to fall, and this was one of the reasons for the economic decline that started at the beginning of 2008. At the end of 2008 and during 2009, the global financial and economic crisis made things even worse. From mid-2009, real estate prices started to rise in some cases, but by then the average fall in prices had been 45%. Now, interest in buying is still relatively modest, and most buyers are well-to-do people in search of considerably higher-grade immovable property than was offered for sale during the boom.
Most construction activity took place in Tallinn, other bigger cities and around them. That’s where most of the buying and selling happens now, too. Talking about problems that accompany such urban sprawl – car usage increase, a scarcity of schools, kindergartens and other establishment etc – has become more common, but there are no good ideas about how to control sprawl.
Still, a lot of money is spent renovating and rebuilding older buildings. The state supports making old Soviet apartment buildings more energy efficient. Estonians have started to acquire summer houses in the countryside again, and they have taken up gardening.
Estonian real estate prices vary a great deal. Property is most expensive in downtown Tallinn, but prices are also quite high in the seaside areas of Tallinn and Pärnu. Meanwhile, in some areas one can find a residence very cheaply. Also, big apartment buildings are becoming empty of people and the next step may be demolition.
The construction sector has seen both very good and bad times in the last couple of decades. The bad times were obviously during the recent economic crisis. But construction involves more than just building residences; a lot of construction has happened, and will happen, for companies. With help from the state and the structural funds of the European Union, many construction projects have been launched and are planned: freeways, cleaning apparatuses, energy ventures etc. In addition, schools, hospitals and other buildings that are very important to the public are being built. Quite a few construction entrepreneurs have always found work abroad, in Finland but sometimes farther away: in Sweden, Norway and other places.Details about this article
Created: 03.10.2005 13:58
Modified: 27.09.2012 17:12