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Finland's residential property prices are beginning to rise after experiencing the sharpest decline since the early 1990s.
As we reach mid-2025, the Finnish property market shows early signs of recovery with modest growth expected in urban centers, though significant regional variations persist.
If you want to go deeper, you can check our pack of documents related to the real estate market in Finland, based on reliable facts and data, not opinions or rumors.
Finland's property prices are forecast to increase by 1.5% nationally in 2025 and 2.5% in 2026, driven by falling interest rates and critically low construction levels.
Urban centers like Espoo, Oulu, and Rovaniemi are already showing positive momentum, while new apartments lead the recovery with 3.7% year-on-year growth.
| Metric | Value | Trend |
|---|---|---|
| Average Price (Second-hand) | €2,609/m² | -1.3% YoY (Q1 2025) |
| Average Price (New dwellings) | €4,954/m² | +1.6% YoY (Q1 2025) |
| 2025 Price Forecast | +1.5% nationally | Recovery beginning |
| 2026 Price Forecast | +2.5% nationally | Accelerating growth |
| Mortgage Interest Rate | 2.4% (12-month Euribor) | Declining |
| Construction Starts | 21,000 units (2023) | Historic lows |
| Urban vs Rural | Strong urban demand | Rural markets weak |
| Top Growth Cities | Espoo, Oulu, Rovaniemi | Positive momentum |
| Market Status | Buyer's market | Shifting to balanced |
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.
How much have property prices changed in Finland during the past year?
Property prices in Finland have experienced a mixed performance over the past year, with second-hand dwellings decreasing by 1.3% year-on-year nationally while new dwellings showed resilience with a 1.6% increase as of Q1 2025.
The market hit bottom in early 2024, with prices falling more than 10% from their summer 2022 peak, but as of June 2025, the recovery is underway though remains uneven across regions.
Looking at specific property types, old apartments fell 1.2% nationally and old terraced houses declined 1.5%, while new apartments rose 3.7% nationally despite new terraced houses dropping 4.9%.
The Greater Helsinki area saw old dwelling prices fall by 1.3%, though new apartments in the capital region rose by 3.4%, demonstrating the divergence between new and existing property performance.
It's something we develop in our Finland property pack.
Which areas in Finland are seeing the biggest property price increases right now?
As of June 2025, several Finnish cities are experiencing notable price growth after the recent downturn, with Espoo-Kauniainen stabilizing and forecast to grow 2.7% in 2025.
| City | Current Price Trend | 2025 Forecast |
|---|---|---|
| Espoo-Kauniainen | Stabilizing | +2.7% |
| Oulu | Already positive YoY | +2.6% |
| Rovaniemi | Positive momentum | Strong growth |
| Vaasa | Recovering | Positive trend |
| Vantaa | Still declining (-3.8%) | +0.4% |
| Helsinki | Stabilizing | +1.5% |
| Turku | No longer falling | +1.4% |
What are the current mortgage interest rates affecting Finland's property market?
As of June 2025, mortgage interest rates in Finland have declined significantly from their 2024 peaks, with the 12-month Euribor at 2.4% and the 3-month Euribor just below 2.5%.
This represents a substantial drop from the peak of over 4% in 2024, with rates expected to fall to around 2.0% by summer 2025 following the European Central Bank's 0.25% rate cut on June 6, 2025.
Lower rates have already boosted mortgage applications, with new housing loan drawdowns increasing by 24% year-on-year in January 2025, signaling renewed buyer confidence.
Two additional ECB rate cuts are expected during spring 2025, which should further stimulate the property market and support the forecasted price recovery.
The declining interest rate environment is a key factor supporting the positive price forecasts for 2025-2026 across Finland's urban centers.
How has the new 2025 mortgage regulation impacted the Finnish property market?
The Finnish government's 2025 mortgage regulation changes have significantly improved market accessibility by extending maximum loan terms from 30 to 35 years and raising the loan-to-value ceiling to 95%.
First-time buyers now need only a 5% down payment, while regular buyers require 15%, substantially reduced from previous levels, making homeownership more attainable for younger generations.
These changes have already stimulated demand, particularly among first-time buyers who were previously priced out of the market during the high interest rate period of 2023-2024.
The extended loan terms and higher loan ceilings are expected to boost both property sales and new construction activity throughout 2025, helping to revive the stagnant construction sector.
Market analysts predict these regulatory changes will be a crucial catalyst for the anticipated 1.5% price growth in 2025 and continued recovery into 2026.
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What is the property price forecast for Finland in 2026?
Property prices in Finland are forecast to increase by 2.5% nationally in 2026, according to multiple sources including Nordea's latest housing market review.
This projection is supported by continued low construction activity creating supply shortage, further interest rate normalization, and economic recovery gaining momentum with GDP growth of 1.6% expected.
Urban population growth outpacing housing supply and pent-up demand from the 2023-2024 downturn will drive prices higher, particularly in growth centers.
Regional variations will persist, with the Greater Helsinki area, Espoo, and Oulu expected to outperform the national average by significant margins.
The forecast assumes no major economic shocks or geopolitical escalations, though experts note that Finland's property market recovery will likely remain more moderate than other Nordic countries.
Which property types are currently experiencing the strongest price growth?
New apartments are the clear winners in Finland's current property market recovery, showing 3.7% year-on-year growth driven by strong demand and limited supply.
| Property Type | Price Performance | Market Dynamics |
|---|---|---|
| New apartments | +3.7% YoY | Strong demand, limited supply |
| New terraced houses | -4.9% YoY | Oversupply in some areas |
| Old apartments | -1.2% YoY | Stabilizing, location-dependent |
| Old terraced houses | -1.5% YoY | Slower recovery |
| 2000s single-family homes | Strong demand | Quality premium |
| Older single-family homes | Weak demand | Higher renovation costs |
What is the current state of new housing construction in Finland?
Finland's construction sector remains at historic lows as of June 2025, with only 21,000 units started in 2023, the lowest in a decade.
The severe construction slowdown continued through 2024 with minimal new projects, leaving approximately 5,000 unsold new homes in inventory as of autumn 2024.
Construction company bankruptcies are rising due to difficult market conditions, further constraining future supply and creating conditions for price increases.
Experts predict that significant new housing production won't reach the market before 2027, even in optimistic scenarios, creating a supply shortage that will likely push prices up especially in urban centers.
This supply constraint is a key factor supporting the positive price forecasts for 2025-2026, particularly in high-demand areas like Helsinki, Espoo, and Oulu.
How does Finland's current property market compare to five years ago?
Finland's property market has underperformed compared to many European peers over the past five years, with total nominal price increases of approximately 12%, among the slowest in Europe.
Current prices remain below summer 2022 highs despite the recent recovery, while construction activity has dramatically reduced from 2019 levels, creating future supply challenges.
Finland lags behind Sweden, Norway, and Denmark in terms of price appreciation, reflecting the country's more conservative market dynamics and economic challenges.
Mortgage rates remain higher than five years ago despite recent declines, continuing to constrain affordability for many potential buyers.
The market has gone through a complete cycle from steady growth through 2022, sharp decline in 2023-2024, and now early recovery in 2025, offering better value than the 2022 peak particularly for first-time buyers.
We made this infographic to show you how property prices in Finland compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It's an easy way to spot where you might get the best value for your money. We hope you like it.
What impact has the 2025 ban on Russian property purchases had on the market?
The ban on Russian nationals purchasing property in Finland, effective spring 2025, has had limited direct market impact as Russian buyers represented only a small market share.
Implemented for national security reasons, the measure has caused marginal demand reduction in some border regions but no significant effect on overall price trends.
While the ban signals increased geopolitical caution and has some psychological impact on market confidence, its actual effect on property prices has been minimal.
The measure primarily affects border areas and luxury properties that previously attracted Russian investment, with mainstream residential markets largely unaffected.
It's something we develop in our Finland property pack.
How are rental yields and demand trending in Finland's major cities?
Rental market dynamics in Finland show rental growth near 0% in Greater Helsinki while other large cities see 2-3% annual increases as of June 2025.
| City/Region | Rental Growth | Vacancy Trends | Yield Outlook |
|---|---|---|---|
| Greater Helsinki | Near 0% | Decreasing | Stable |
| Other large cities | 2-3% annually | Normalizing | Improving |
| Student areas | Declining | Rising | Challenging |
| Urban centers | Moderate growth | Tightening | Positive |
What are the main risks facing Finland's property market for the remainder of 2025?
Several significant risks could impact Finland's property market recovery, including ongoing Russia-Ukraine conflict creating geopolitical tensions and potential trade disruptions affecting exports.
Economic uncertainties remain with potential weaker-than-expected recovery, global inflation resurgence risks, and the possibility of unexpected interest rate hikes derailing the current positive momentum.
Construction sector vulnerabilities persist through continued bankruptcies limiting supply, credit availability challenges for developers, and skilled labor shortages constraining new building activity.
Climate change impacts pose increasing risks through potential coastal property devaluation, rising insurance costs, and flood-prone area concerns affecting property values.
Despite these risks, the financial sector maintains strong buffers with banks well-capitalized and household debt levels remaining manageable compared to other Nordic countries.
Which factors will most influence Finnish property prices through the end of 2025?
The key positive drivers for Finland's property market include falling interest rates with two more ECB cuts expected, economic recovery with GDP growth returning, and urban population growth especially in Helsinki, Espoo, and Oulu.
Supply shortage from low construction levels and government support through relaxed mortgage regulations will create upward price pressure in desirable locations.
Restraining factors include household caution as many adjust finances post-inflation, continued rural market weakness, and new supply not arriving until 2027.
International uncertainty from global economic headwinds and demographic shifts with an aging population changing demand patterns will moderate growth rates.
The balance suggests continued modest recovery, with urban markets outperforming and quality properties in good locations seeing strongest demand through year-end.
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.
Finland's residential property prices are going up, but the recovery remains modest and location-dependent. After experiencing the sharpest decline since the 1990s recession, with prices falling over 10% from their 2022 peak, the Finnish property market is showing clear signs of stabilization and recovery as of June 2025.
National prices are forecast to rise 1.5% in 2025 and 2.5% in 2026, driven by falling interest rates, eased mortgage regulations, and critically low construction levels creating supply shortages. Urban centers like Espoo, Oulu, and Rovaniemi are already seeing positive momentum, while rural markets continue to struggle. The combination of economic recovery, demographic trends favoring cities, and structural undersupply positions the market for gradual appreciation rather than rapid growth.
Sources
- Statistics Finland - Official Real Estate Price Statistics
- Global Property Guide - Finland Residential Property Analysis 2025
- Nordea - Finland Housing Market Review Q1 2025
- Bank of Finland Bulletin - Housing Market Analysis
- Finnish Real Estate Federation (SKVL) - Housing Market Forecast 2025
- Investropa - Finland Real Estate Market Forecasts
- Helsinki Times - Finnish Housing Market Updates
- Financial Supervisory Authority of Finland - Real Estate Risk Assessment
- European Commission - Economic Forecasts for Finland
- Trading Economics - Finland Housing Index Data