THE PRICES of old dwellings in housing companies increased by 3.2 per cent year-on-year and by 0.8 per cent month-on-month in April, indicates preliminary data published by Statistics Finland on Tuesday.
The year-on-year increases added up to 2.6 per cent in the six largest cities and to 4.5 per cent in other parts of Finland.
Juho Keskinen, an economist at the Mortgage Society of Finland (Hypo), said market activity remained surprisingly strong in spite of the war of aggression waged in Ukraine by Russia.
“The mood has settled down and the high levels of activity witnessed during the coronavirus crisis are clearly behind us. But sales are still higher than they were three years ago before the pandemic,” he commented.
Tampere, Turku and Espoo registered the greatest price increases out of the largest cities, with the prices of old dwellings rising by 5.4, 5.0 and 4.7 per cent, respectively. Prices in the capital region crept up by only 1.9 per cent as the prices rose considerably less than the national average – by 1.6 per cent – in Helsinki and fell by 0.6 per cent in Vantaa.
“It looks like real estate investors were rattled by the war more than people looking for a new home, which is reflected in price developments especially in the capital region,” said Keskinen.
The sales of old dwellings did nonetheless slow down. The number of sales brokered by real estate agencies, the preliminary data shows, decreased by 15 per cent from the corresponding period one year earlier.
Keskinen viewed that the development is attributable largely to the cautiousness of investors.
“Rising charges for expenses and interest rates are undermining the profits of investors because a large number of small flats the construction of which started before the war will be completed this year. People looking for their own home are still looking for floor space that facilitates remote work, and the prices of larger dwellings will continue to increase also this year.”
The situation is opportune for many people looking for their first home.
“People looking for a smaller, first home have the opportunity to negotiate more enterprisingly about prices because the prices of one-room flats are falling this year even in growth centres,” said Keskinen.
Aleksi Teivainen – HT
