Sten Renar Subatšjus
May Market Overview: VAT Hike Fuels Surge in New Development Sales
The sale of new apartments in Tallinn increased by more than 20%, the main reason of which is the VAT increase from July 1.
In May, a total of 1836 apartment sales were concluded across Estonia – marking the highest monthly figure of the year so far. Alongside the increased transaction volume, the nationwide median price for real estate deals rose by 4% year-on-year.
The market has shown notable resilience despite ongoing tax increases and persistently low consumer confidence. A significant contributor to this growth has been heightened activity in popular summer home destinations – most notably, Pärnu County, where the number of transactions jumped by more than 40% in a single month.
Estonian Apartment Market
Tallinn
While median prices in Tallinn dipped by 5% compared to April and 7% compared to last May, the number of transactions rose – up by five deals month-on-month and nearly 20% year-on-year. Preliminary data shows 770 transactions were made in April, with a median price of 2734 € per square meter.
The most notable trend is the remarkable surge in new development sales, with a 20% monthly and 40% annual increase, largely driven by the upcoming VAT hike on July 1st. Buyers are rushing to close deals before the new tax rate takes effect, and this is expected to keep June’s activity above average. The longer-term impact of this tax change will become clearer in the second half of the year.
Tartu
After a strong April, Tartu saw a cooldown in May, with transaction volume falling 9% month-on-month and over 14% year-on-year. A total of 131 deals were concluded, at a median price of 2354 €/m². While still below last year’s levels, prices have been showing a slight upward trend since the beginning of this year.
Pärnu
May brought renewed momentum to Pärnu’s property market. 79 transactions were made – up 41% from April, marking the strongest performance in the past 18 months. The median price reached 2375 €/m². Compared to last year, the transaction volume grew modestly by six deals, but the median price soared over 20%, suggesting that holiday home buyers are anticipating a sunny summer season.
Narva
Narva’s market remained stable but subdued in May. Transactions fell slightly from April, down by two, and overall activity remains low. However, the median price rose 6% month-on-month. Compared to last year, the market is still under pressure, with transaction volume down nearly 19% and prices off by almost 15%. Continued price corrections reflect sellers adjusting to reality, though asking prices still remain significantly above actual sale prices.
24.06.2025
The Power of Pattern Drenching
Pattern drenching is the secret weapon of top interior designers. From Marie Antoinette to today’s design elites, this timeless French-inspired technique makes small rooms feel larger, hides flaws, and creates a striking, cohesive look. It’s bold, elegant, and always unforgettable.
06.05.2025
April Market Overview – Stability Lays the Groundwork for Price Growth
Although April displayed its usual variety, the average temperature in Estonia was above normal, with a new monthly record set at 27.8°C. The blooming spring and falling EURIBOR rates led to increased real estate viewings, reflected in the rise in transaction volume.
