Is buying property in Finland worth it now?

Authored by the expert who managed and guided the team behind the Finland Property Pack

Everything you need to know before buying real estate is included in our Finland Property Pack

Who is the author of this content?

INVESTROPA

A team specialized in real estate investing in European countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Finland. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At INVESTROPA, we explore the Finnish real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Helsinki, Tampere, and Turku. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What's happening with property prices in Finland right now?

Finland's property market is experiencing a gradual recovery after hitting bottom in late 2024.

National property prices are expected to rise 1.5% in 2025 and 2.5% in 2026, following a roughly 10% decline from 2022 peaks. Urban areas are leading this recovery, with cities like Espoo-Kauniainen forecasted to grow 2.7% in 2025, Oulu at 2.6%, and Helsinki stabilizing at 1.5% growth.

The recovery is uneven across property types and regions. In Q2 2025, old single-dwelling house prices were still down 2.7% year-on-year, while new apartment prices grew 3.7%. This divergence reflects stronger demand for modern properties and urban living. Rural and secondary markets remain weak, with many areas still experiencing declining values.

The key driver behind this price stabilization is critically low new construction volumes combined with falling interest rates. Construction activity has dropped significantly since 2022, creating a supply shortage that's now supporting prices as demand begins to return.

It's something we develop in our Finland property pack.

How are interest rates in Finland affecting mortgages and affordability?

Interest rates have dramatically improved Finland's mortgage affordability in 2025.

The 12-month Euribor rate has dropped to approximately 2.4% in mid-2025, down from over 4% in 2024. Finnish banks are now offering effective mortgage rates around 3.1%, with rates continuing to trend downward. This represents a significant improvement in borrowing costs for property buyers.

New government regulations have made mortgages more accessible, particularly for first-time buyers. Loan terms can now extend to 35 years, and loan-to-value ratios have increased to 95%, meaning buyers can purchase with just a 5% down payment compared to the previous norm of 15%.

These improved conditions have led to a surge in mortgage applications and drawdowns. Housing loan drawdowns in early 2025 outpaced the previous two years, indicating renewed buyer confidence and market activity.

The combination of lower rates and relaxed lending standards has effectively restored affordability to levels not seen since before the 2022 rate hikes began.

What are the main economic trends in Finland that could impact property values?

Several economic trends are shaping Finland's property market outlook for 2025-2026.

Economic Factor	Current Impact	Property Market Effect
Interest Rate Environment	Falling from 4%+ to 2.4%	Improved affordability driving demand
Construction Activity	Historically low volumes	Supply shortage supporting prices
Urban Migration	Continued city concentration	Strong urban demand, weak rural markets
Investment Sentiment	Risk-averse but improving	Q2 2025 saw 24% jump in property investment
Economic Recovery	Modest but consistent	Supporting employment and buyer confidence
Geopolitical Risks	Ongoing concerns	Some investor caution remains
Population Demographics	Aging, urbanizing	Long-term support for city property demand

Is there strong demand for housing in major Finnish cities or is it slowing down?

Demand is strengthening in major Finnish cities after the 2022-2024 downturn.

Urban centers are experiencing renewed interest from both domestic and international buyers. Transaction volumes and mortgage drawdowns are rising, though the overall pace remains modest by historic standards. Cities with the strongest momentum include Espoo, Oulu, and Rovaniemi, while Helsinki is showing steady stabilization.

The demand recovery is primarily driven by improved mortgage conditions, returning investor confidence, and continued urban migration patterns. Finland's population continues to concentrate in major metropolitan areas, providing underlying support for city property markets.

However, demand remains selective. Buyers are focusing on quality properties in prime locations, modern apartments, and areas with good transportation links. Secondary markets and rural areas continue to struggle with weak demand and declining populations.

The rental market has also exceeded expectations in Q2 2025, with new apartments especially in demand, indicating a healthy underlying demand base for residential property in urban areas.

How does the rental market look, and are rental yields attractive compared to costs?

Finland's rental market is stabilizing and becoming more attractive for investors in 2025.

The rental market exceeded expectations in Q2 2025, with yields becoming more competitive as property prices stabilized and rents held firm. New apartments are particularly in demand, reflecting tenant preferences for modern amenities and energy efficiency.

Rental yields are improving due to the combination of recovering rental demand and more stable property prices. Urban areas are seeing the strongest rental performance, supported by continued migration to cities and a shortage of new rental supply.

However, investors must factor in significant operating and financing costs. Property maintenance, management fees, and taxes can substantially impact net yields. The regulatory environment supports tenant rights, which provides stability but also means landlords face restrictions on rent increases.

Population shifts toward city regions and regulatory adjustments support long-term rental market stability, making buy-to-let investments more viable than during the peak decline period of 2022-2024.

Are there any new government policies or taxes that affect property owners or buyers?

The Finnish government has introduced several buyer-friendly policies in 2025 without adding new tax burdens.

The most significant changes relate to mortgage accessibility. New regulations allow mortgage terms up to 35 years and loan-to-value ratios up to 95%, enabling first-time buyers to purchase with just a 5% down payment. These changes have dramatically improved market access for younger buyers and those with limited savings.

No new punitive taxes have been introduced for property owners or foreign buyers. The existing tax structure remains stable: transfer tax at 2% for individuals (4% for companies), plus standard notary, registration, and agency fees totaling 2-4% of purchase price.

Annual property taxes vary by municipality from 0.41% to 2% depending on location and property type. Foreign buyers face no special tax penalties, though all ownership must be registered in the Land Information System.

The regulatory environment continues to support long-term property ownership and investment, with no indication of upcoming changes that would negatively impact property owners.

How easy is it for a foreigner to buy property in Finland and what restrictions exist?

Foreign property ownership in Finland is remarkably straightforward with minimal restrictions.

1. **EU Citizens**: Can purchase any type of residential property anywhere in Finland without restrictions 2. **Non-EU Citizens**: Can generally purchase residential property freely, with only minor exceptions for specific archipelago, island, or defense zones 3. **Registration Requirements**: All property ownership must be registered in the Land Information System regardless of nationality 4. **Financing Access**: Foreign buyers can access Finnish mortgages, though banks may require higher down payments or additional documentation 5. **Legal Process**: The purchase process is identical for foreign and domestic buyers, involving standard contracts and notarization

The exceptions for restricted areas primarily affect remote island properties or areas near military installations, which rarely impact typical residential purchases in cities or suburbs. Most foreign buyers encounter no practical barriers to property acquisition.

Finland's open approach to foreign property ownership reflects its EU membership and commitment to free movement of capital. This makes it one of the more accessible European property markets for international investors.

It's something we develop in our Finland property pack.

What are the typical transaction costs, taxes, and ongoing ownership expenses?

Finland's property transaction and ownership costs are moderate by European standards.

Cost Category	Rate/Amount	Who Pays
Transfer Tax (Individuals)	2% of purchase price	Buyer
Transfer Tax (Companies)	4% of purchase price	Buyer
Notary Fees	0.1-0.2% of purchase price	Buyer
Registration Fees	€200-500	Buyer
Real Estate Agent	3-5% of purchase price	Seller (typically)
Annual Property Tax	0.41-2% of taxable value	Owner
Building Maintenance (Apartments)	€200-600/month	Owner

Are there specific regions or cities in Finland that are expected to grow faster than others?

Urban regions significantly outperform rural areas in Finland's property market recovery.

The Helsinki metropolitan area (including Espoo and Vantaa) leads growth expectations, with Espoo-Kauniainen forecasted for 2.7% price growth in 2025. These areas benefit from strong employment, infrastructure, and international connectivity.

Oulu in northern Finland shows surprising strength with 2.6% expected growth in 2025, driven by its technology sector and university presence. Rovaniemi, despite its remote location, benefits from tourism and serves as a regional center.

Tampere and Turku, as Finland's second and third largest cities respectively, show steady but more modest growth prospects. These cities offer more affordable entry points while maintaining urban amenities and employment opportunities.

Rural areas and small towns face challenging prospects, with declining populations, limited employment, and weak demand creating a prolonged stagnation cycle. Properties in these areas may continue declining in value for years.

The urban-rural divide in Finland is expected to persist and potentially widen, making city selection crucial for property investment success.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Finland versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

How does property investment in Finland compare with other European countries?

Finland offers stable, moderate returns compared to more volatile European property markets.

Compared to neighboring countries, Finland provides moderate entry costs and yields with a stable macroeconomic environment. The country experiences less dramatic boom-bust cycles than faster-rising markets in Southern or Eastern Europe, appealing to conservative investors seeking steady appreciation.

Finland's property market offers several advantages: political stability, strong legal framework, transparent transaction processes, minimal corruption, and reliable rental markets. The country's EU membership provides additional security for international investors.

However, Finland's growth potential is more limited than emerging European markets. Countries like Poland, Portugal, or Estonia may offer higher returns but with correspondingly higher risks. Finland's mature economy and stable population growth limit explosive price appreciation.

For investors seeking steady, long-term growth with minimal political or economic risk, Finland compares favorably to Germany, Austria, or Denmark. The recent price correction has also improved entry valuations compared to peak 2021-2022 levels.

What risks should buyers be aware of, such as oversupply or population trends?

Several key risks could impact Finland's property market recovery in the coming years.

1. **Potential oversupply**: If planned developments proceed while demand doesn't sustain current levels, certain areas could face oversupply 2. **Rural population decline**: Continued urbanization leaves rural properties increasingly illiquid and declining in value 3. **Global economic uncertainty**: International economic downturns could impact Finland's export-dependent economy and property demand 4. **Geopolitical tensions**: Finland's proximity to Russia creates ongoing uncertainty that may affect investor sentiment 5. **Interest rate volatility**: While rates are currently falling, future increases could quickly impact affordability and demand

The most significant long-term risk is demographic change. Finland's aging population and low birth rates could eventually limit demand growth, particularly outside major cities. Rural areas face accelerating population decline that makes property ownership increasingly risky.

Construction industry challenges also pose risks. Labor shortages and material costs could lead to sudden supply increases if resolved, potentially overwhelming recovering demand.

It's something we develop in our Finland property pack.

Does buying now make sense for a long-term hold, or is it better to wait?

For long-term investors focused on quality urban assets, current conditions favor buying over waiting.

The combination of improved lending conditions, stabilizing prices, and historically low construction creates a favorable entry environment. Urban properties in Helsinki, Espoo, Tampere, and Oulu offer reasonable prospects for steady appreciation over 5-10 year holding periods.

Current buyers benefit from better financing terms than were available in 2022-2024, with 35-year mortgages and 5% down payments making leverage more accessible. Interest rates are trending lower, potentially improving returns if rates continue declining.

However, speculative investors or those seeking quick returns might consider waiting for confirmed momentum. The recovery is gradual rather than explosive, meaning early entry provides modest advantages rather than dramatic gains.

Geographic and asset selection remain crucial. Prime urban properties with good transportation links and modern amenities show the strongest prospects, while secondary locations and older properties face continued challenges.

For buyers planning to live in the property or hold for decades, current pricing and financing conditions are attractive. Short-term traders might find better opportunities in more volatile markets.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. InvestRopa - Finland Price Forecasts
2. Retta Management - Finnish Residential Rental Market Q2 2025
3. Helsinki Times - Mortgage Interest Rates Continue to Decline
4. Statistics Finland - House Price Index
5. Global Property Guide - Finland Mortgage Interest Rates
6. Global Property Guide - Finland Price History
7. Realting - How the Finnish Real Estate Market Has Changed
8. Bank of Finland - Housing Loan Drawdowns January 2025