Estonian housing prices up 6% year on year as market shows signs of recovery
Statistics Estonia data show housing prices rose 6% year on year, with industry figures pointing to renewed buyer interest after a prolonged downturn. Growth is now driven mainly by the secondary market, while new-build sales lag behind.
Estonia's property market appears to be turning a corner after years of decline, with fresh data from Statistics Estonia showing housing prices up six percent compared with a year earlier. Market participants say both prices and buyer interest have been climbing recently.
Completed, move-in-ready apartments in new developments are finding buyers, and in Tallinn especially, purchasers increasingly favor convenience and saving time over other considerations. Developers, meanwhile, are seeing average prices climb as construction costs rise.
Indrek Tarto, head of developer Merko Kodud, said sales of new homes in Tallinn hit bottom in 2024, but transaction numbers have since grown roughly five percent annually for two straight years — modest but steady evidence of rising demand.
New builds trail the resale market
Despite that, newly built apartments are underperforming existing homes. Transactions involving new apartments fell more than 40 percent in the second quarter of this year compared with the first quarter, while the secondary market — particularly outside Tallinn — continues to expand.
Karin Noppel-Kokerov of the City24.ee property portal said new-development prices in Tallinn have held steady around €4,635 per square meter, with growth slowing to just 0.7–1 percent over the last two quarters. Today's price growth is instead coming from resales: up 4.3 percent in Tallinn and 4.6 percent in surrounding areas. A brand-new Tallinn apartment now costs 55 percent more per square meter than a comparable resale unit; in Tartu the gap is 43 percent.
Because wage growth has lagged behind housing price increases in recent years, demand has shifted toward older, cheaper apartments. Bigbank chief economist Raul Eamets expects economic growth of around 2–2.5 percent this year and strong wage growth, which together could push housing demand higher — though a possible rise in interest rates next year could dampen that effect.
According to Statistics Estonia, the dwelling price index rose 3.5 percent quarter on quarter and 5.8 percent year on year in the second quarter of 2026. Apartment prices climbed 5.3 percent and house prices 6.8 percent year on year, though both increases were slower than in previous quarters, according to data scientist Hendrik Pungar.
