Defining luxury real estate varies slightly among agents, but common features include architectural value, premium construction quality, size, location, and uniqueness. Such properties are equipped with modern communication and technology solutions, offering additional amenities such as hobby rooms, home spas, home theaters, and tennis courts, allowing residents to enjoy hobbies and a luxurious lifestyle without leaving home. Luxury and premium-class real estate also reflect privacy, tranquility, and a secure living environment, where all essentials of life—schools, sports clubs, shops, entertainment—are conveniently close.

Recently, more high-end properties have entered the market due to high price levels and overall uncertainty, exacerbated by geopolitical and economic instability. Consequently, some individuals are diversifying their assets by selling part of their real estate in Estonia and investing elsewhere, such as in Southern Europe, Dubai, or Southeast Asia.

Most sellers of luxury real estate are local residents diversifying their portfolios or seizing profit opportunities. Some sell their property due to changing life circumstances— for example, when a summer home in Saaremaa no longer appeals, or when a large house is exchanged for a smaller apartment as children leave home.

The threat of war has also affected the luxury real estate market, especially concerning the disappearance of Russian clients. While some people feel direct danger, for others, this time presents an opportunity to acquire high-quality real estate. Although the high Euribor affects the entire economy, purchases of luxury real estate are often made with equity, thus limiting the impact.

Prices for luxury real estate remain high, continuing to achieve record square meter prices. Although the market has become more cautious, demand for high-quality and well-located properties persists. The economic situation also affects the luxury real estate market, but demand remains for properties that meet buyers’ high standards.

Currently, luxury real estate is primarily being purchased for residential purposes, although some do so as an investment or second home. The future remains uncertain, but the market supply will remain high, and transaction activity may stay below average. New and high-quality properties continue to command high prices, while older and lower-quality properties lose value.