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
Are you considering investing in Finland’s real estate market? What are the legal steps, tax implications, and cultural differences you need to understand before taking the plunge? What challenges do foreign investors typically face, and how can you overcome them?
These are the questions we hear most often from foreign investors because we’re actively connected to this market. We’ve spent time working with local agents, developers, and investors, so we know what works—and what doesn’t. That’s why we’ve written this article: to provide a clear guide that answers the questions we get asked daily.
Our goal is to help you, as a foreigner, to navigate the property buying process with confidence. If you think there’s something we missed or want more details, let us know (please do!). Your input helps us refine and improve our advice for everyone.
How this content was created 🔎📝
1) Plan ahead for financing in Finland, as foreign buyers without local credit history may face challenges
In Finland, foreigners can buy property without any restrictions.
In 2023, foreign investors made up over half of Finland's property transaction volume, even though the overall market slowed due to high interest rates. This shows how attractive the Finnish real estate market is to international buyers. The Finnish legal system is quite welcoming, allowing non-residents to purchase property as long as they have the right paperwork, like a valid residence permit.
Foreign investors are not just buying; they’re also seeing good returns. In fact, foreign owners earned EUR 5.5 billion from their investments in Finland. This level of participation underscores the confidence international buyers have in the Finnish market.
However, getting a mortgage can be tricky if you don’t have a local credit history. Finnish banks, such as Nordea and Danske Bank, do offer loans to foreigners, but they usually ask for a valid residence permit, proof of income, and identity verification. Without a local credit history, securing a loan can be a hurdle, which is a common issue for foreign buyers.
Despite these challenges, the Finnish property market remains appealing. The country’s stable economy and transparent legal framework make it a safe bet for international investors. Foreign buyers are drawn to Finland's strong economic fundamentals, which provide a sense of security in their investments.
Sources: Bank of Finland Bulletin, Global Property Guide, HPP Attorneys
2) Hire a local translator or lawyer for Finnish real estate deals, as transactions are usually conducted in Finnish to avoid costly misunderstandings
In Finland, over 90% of the population speaks Finnish, making it the primary language for real estate transactions.
When buying property in Finland, you'll encounter detailed legal documents often written in Finnish. This can be tricky if you're not fluent, so it's wise to have a local legal expert on your side to ensure everything is crystal clear.
Many foreign buyers, like a client from the UK, have faced language barriers that complicate the process. This client found the legal jargon overwhelming until they hired a professional translator, underscoring the value of local expertise.
Misunderstandings in property deals can lead to costly legal disputes. A simple misinterpretation of a contract clause might escalate into a legal battle, which is why having a local lawyer or translator is crucial.
It's common for Finnish real estate transactions to be conducted in Finnish, so hiring a local translator or lawyer can prevent costly misunderstandings.
Sources: Tomedes, Bergmann, Suomi.fi
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.
3) Don’t underestimate the value of a good property manager, especially if you’re not living in Finland
Managing a property from afar can be tricky, especially if you're not familiar with the local market and regulations.
In Finland, the real estate market is evolving, with increased demand for property management services as the market is expected to bounce back in late 2024. This means more investment opportunities and a greater need for professional management to handle these properties effectively.
For foreign property owners, understanding Finnish property laws can be a bit of a maze. Since 2020, foreign buyers must apply for permission to purchase property in Finland, which highlights the complex legal landscape. A savvy property manager who knows these local regulations can be a lifesaver, ensuring compliance and helping you dodge potential legal pitfalls.
Absentee property owners often struggle with keeping the property in good shape and managing tenant relationships. Professional property managers can tackle these issues by using technology and local expertise to optimize leasing strategies and enhance tenant experiences. This not only helps maintain the property's value but can also boost profitability.
In Finland, a good property manager is crucial, especially if you don't live there. They can handle everything from routine maintenance to tenant disputes, making your life much easier. Plus, they have insider knowledge of the local market, which can be invaluable.
Don't underestimate the importance of a good property manager. They can be the difference between a smooth operation and a constant headache. Having someone on the ground who knows the ropes can save you time, money, and stress.
Sources: HPP Attorneys, BGSF, CBRE Finland
4) Consider areas near future infrastructure projects in Finland to maximize property value growth
Investing in properties near upcoming infrastructure projects in Finland is a smart move for maximizing profit.
Historically, property values in Finland tend to rise when new infrastructure is developed. For instance, the Finnish Transport Infrastructure Agency is working on several projects from 2023 to 2025, including road and railway developments. These projects have already led to increased property values in those areas, making them attractive for potential buyers.
The Finnish government is committed to spending EUR6.1 billion over 12 years to upgrade the country's transport infrastructure. This kind of investment typically boosts property values in the regions where these projects are implemented. In the past, regions like Helsinki-Uusimaa have seen substantial growth due to new transportation links, with a 38.7% increase in construction-related value from 2010 to 2017.
Real estate experts predict that properties near upcoming infrastructure projects will continue to yield high returns. Projects like the Digirata and Länsirata are expected to bring significant work and investment, which can positively impact property values. Additionally, areas with new infrastructure often experience population growth, further driving up property values.
Investing in these areas not only promises potential financial gains but also offers a chance to be part of a growing community. As new roads and railways are built, they bring more people and businesses, enhancing the local economy and lifestyle.
Keep an eye on these developments, as they can be a golden opportunity for property investment. The combination of government commitment and expert predictions makes this a promising venture.
Sources: Finland Construction Industry Report 2023, European Construction Sector Observatory, The government's infrastructure decisions strengthen Finland's...
5) Consider investing in university towns, as student demand ensures consistent property interest
Buying property in university towns is a smart investment because there's always a demand from students.
In Finland, 27,500 new students entered universities in 2023, with the University of Helsinki and Tampere University leading the pack. This steady stream of students means a constant need for housing, making these areas attractive for property investors.
Rental yields in university towns are stable and even rising. For example, Turku offers high returns of 10.4% for single-room dwellings, while Helsinki and Jyväskylä also show promising returns. This makes investing in these areas a reliable way to earn income.
The demand for student housing is at an all-time high, driven by the rising cost of living and an increase in international students choosing Finland. With planned benefit cuts, this demand is expected to grow, making student housing a hot commodity.
University towns are not just about education; they are vibrant communities with cultural events, cafes, and nightlife, attracting students and young professionals alike. This lively atmosphere ensures a consistent rental market and potential for property value appreciation.
Investing in these areas means tapping into a market with consistent demand and potential for growth, especially in towns with a strong student presence.
Sources: Global Property Guide, Statista, GSL Global
Get fresh and reliable information about the market in Finland
Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.
6) Renovate with modern, minimalist interiors in mind, as Finnish buyers often prefer this style
Understanding Finnish buyers' love for modern, minimalist interiors can give you a real advantage when renovating a property.
In 2023, a survey by the Finnish Building and Real Estate Industries (EVA) found that 75% of Finnish homebuyers prefer this sleek and simple style. This trend is not just a passing phase; it's a clear preference that can guide your renovation choices.
Moreover, a 2024 report by the Finnish Real Estate Federation (Kiinteistömaailma) showed that homes with modern, minimalist renovations often sell for higher prices. This means that investing in such updates can lead to better financial returns, making it a smart move for sellers.
The 2023 Interior Design Trends Report by the Finnish Interior Designers Association also highlighted a strong focus on clean lines and functional furniture. These elements are highly valued by Finnish consumers, reinforcing the importance of minimalist aesthetics in the market.
Real-life examples back this up. A 2023 case study by the real estate agency Fennia revealed that a property with modern, minimalist elements sold 20% faster than similar homes without these features. This shows that such designs can make properties more appealing to buyers, leading to quicker sales.
So, if you're thinking about buying or selling property in Finland, remember that embracing minimalist design could be your key to success.
Sources: EVA, Kiinteistömaailma, Suomen Sisustusmuotoilijat, Fennia
7) Consider the impact of winter maintenance, such as snow removal, on costs and tenant satisfaction in Finland
In Finland, property owners face unique challenges due to the country's snowy winters.
With an average annual snowfall of 99cm, managing snow is crucial for safety and accessibility. This isn't just about shoveling; it's about ensuring that pathways and driveways are clear, which can be a big job.
In cities, snow removal services can cost around $125 per session. These costs add up, especially in areas with heavy snowfall, making it a key budget item for property owners. Depending on where you are, these expenses can vary, so it's something to keep in mind when planning your finances.
Tenants really appreciate when snow is cleared quickly. Surveys show that timely snow removal boosts tenant satisfaction, as it prevents accidents and keeps paths safe. No one wants to slip on their way to work or school.
Insurance claims from winter accidents highlight the need for effective snow management. Slips and falls can lead to costly claims, so keeping your property clear is not just about convenience—it's about avoiding potential financial headaches.
Sources: On the Snow, Chicago Code Library, Lawn Guru Blog, Finnish Meteorological Institute
8) Avoid properties with high maintenance fees in housing cooperatives, as they can cut into your rental yield
When considering properties in housing cooperatives, watch out for high maintenance fees.
These fees can really eat into your rental income. In Finland, for instance, maintenance costs have been creeping up, with waste management alone rising by 3.3% recently. If you're planning to rent out, this is crucial because tenants often resist higher rents when fees are steep.
High maintenance fees don't usually boost the property's value. So, even if you're shelling out more, your property might not appreciate in value. This can seriously impact your rental yield, which is the income you earn from renting.
Properties with hefty maintenance fees generally offer lower rental yields. Imagine paying €200 monthly in fees while earning €1,000 in rent; your net income takes a hit compared to properties with lower fees.
In the rental market, tenants are savvy and often look for properties with reasonable fees. They know that high fees can mean higher rents, which they might not be willing to pay.
So, when you're on the hunt for a property, prioritize those with manageable fees to maximize your rental income potential.
Sources: Statistics Finland, Aalto University, Immigrant Invest
We have made this infographic to give you a quick and clear snapshot of the property market in Finland. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Offer furnished apartments in Finland’s competitive rental market to attract more tenants and secure higher rents
In Finland's bustling rental market, Helsinki stands out with its high demand and low vacancy rates.
Many tenants, especially those moving from abroad, prefer furnished apartments to avoid the hassle of buying furniture. This trend is particularly strong among expatriates and international students who value convenience.
Furnished apartments not only offer comfort but also command higher rental prices. Landlords often set higher deposits to cover potential wear and tear on the furniture, making it a win-win for both parties.
Property management companies in Finland have noticed that furnished rentals attract a broader tenant base. This includes professionals and students who are looking for ready-to-move-in options.
Offering fully equipped homes can lead to higher occupancy rates, as these properties appeal to a diverse group of renters. This strategy is particularly effective in cities with a high influx of international residents.
For landlords, providing furnished apartments is a smart move in a competitive market, as it can lead to increased rental income and tenant satisfaction.
Sources: Expat Finland, Finland Forum, Hiisi Homes
10) Focus on long-term investments in Finland, as the property market is less speculative than in other countries
In Finland, the property market is known for its stability, making it less speculative than in some other countries.
This stability is evident in the Real Residential Property Price Index Growth, which has been steady from 1971 to 2024, with a long-term average of 0.653%. Even with recent dips, like the improvement from -8.362% in December 2023 to -6.905% in March 2024, the market remains within a manageable range.
One reason for this steadiness is the lower levels of property flipping and speculative buying. Finnish policies, such as the Housing First initiative, focus on providing permanent housing solutions, discouraging speculation, and promoting a stable market.
Finnish buyers typically prioritize long-term home ownership over quick profits, aligning with the market's overall trend. This approach is supported by government policies that emphasize housing stability.
Reports from Finnish real estate agencies highlight the success of long-term investments. The Finnish Property Market 2024 report notes positive signs like ambitious development plans and balanced rental supply and demand, which contribute to consistent rental yields.
The Finnish government's policies and the country's economic stability play significant roles in maintaining a stable housing market, making it an attractive option for long-term investors.
Sources: CEIC Data, The Atlas, Expat Finland
11) Focus on properties with strong public transport links in Finland, as many locals prefer commuting by train or bus
In Finland, properties near public transport are in high demand.
Many Finns prefer the convenience of public transport, especially in bustling cities like Helsinki. This has led to premium prices for homes close to transport hubs. Imagine living in a place where you can easily hop on a train or bus to get anywhere you need to go. It's not just about convenience; it's about a lifestyle choice that many are willing to pay extra for.
Public transport use has been on the rise, with a noticeable increase in rail trips by the end of 2023. This trend shows that more people are choosing trains over cars, likely because it's both cost-effective and hassle-free. Who wouldn't want to skip the traffic and parking woes?
The Finnish government is also investing heavily in public transport infrastructure. These investments aim to expand and improve services, making it even more appealing for residents. It's not just about getting from point A to B; it's about making the journey smoother and more enjoyable.
Urban planning in Finland is smartly focused on making public transport accessible. This means that new developments often prioritize transport links, ensuring that residents have easy access to buses and trains. It's a win-win for both the environment and the community.
Sources: Statista, Statistics Finland, Bergmann, Smart Cities Dive
Don't buy the wrong property, in the wrong area of Finland
Buying real estate is a significant investment. Don't rely solely on your intuition. Gather the right information to make the best decision.
12) Focus on properties near parks or lakes in Finland, as local buyers value proximity to nature
Understanding what Finnish buyers want is key to succeeding in the real estate market.
Finnish buyers have a strong preference for homes near nature, which is a big selling point. Properties close to parks or lakes are especially attractive because they offer a peaceful escape from city life. In Helsinki, areas like Punavuori and Kallio are seeing price hikes due to their natural beauty and modern amenities.
Research from the Natural Resources Institute Finland shows that being near urban nature boosts mood, making these properties even more desirable. This is why homes with terraces, balconies, or gardens are in high demand in Finnish cities.
Case studies reveal that homes near natural features sell faster than those in more urban settings. This trend is driving up demand for properties in areas rich in natural beauty, as people seek a balance between city living and nature.
In Finland, outdoor spaces are a major selling point. Buyers are willing to pay more for homes that offer a slice of nature, whether it's a garden, a balcony, or a view of a nearby park or lake.
To gain an edge, focus on properties that offer easy access to nature. Finnish buyers value this proximity, and it can make a significant difference in the appeal and price of a property.
Sources: Finland Naturally, Centrarium, Business Insider
13) Ensure renovations in Finland comply with strict building codes and environmental regulations to avoid fines
In Finland, building codes and environmental regulations are notably strict.
Back in 2023 and 2024, the number of building permits granted was significantly lower than in previous years, indicating a shift towards more rigorous standards. For instance, from November 2023 to January 2024, the cubic volume of building permits granted was the lowest in history, with a 44% decrease for residential buildings. This suggests that the regulations have become more demanding, possibly leading to fewer approvals.
For instance, from November 2023 to January 2024, the cubic volume of building permits granted was the lowest in history, with a 44% decrease for residential buildings. This suggests that the regulations have become more demanding, possibly leading to fewer approvals.
Moreover, starting from 2025, Finland requires all public buildings to undergo Life Cycle Assessment calculations, making the calculation of the carbon footprint mandatory. This shows a strong commitment to environmental sustainability, which might not have been as evident in earlier years.
Moreover, starting from 2025, Finland requires all public buildings to undergo Life Cycle Assessment calculations, making the calculation of the carbon footprint mandatory. This shows a strong commitment to environmental sustainability, which might not have been as evident in earlier years.
These changes reflect Finland's dedication to reducing environmental impact and ensuring sustainable development. If you're considering buying property here, it's crucial to understand these regulations to avoid any surprises. Renovations must comply with these standards, or you could face fines.
Sources: Statistics Finland, Nordic Council of Ministers, Avance
14) Consider properties with home office spaces in Finland, as remote work is becoming more popular
In Finland, remote work has become increasingly popular in recent years.
With this shift, many Finns are now seeking homes that offer dedicated office spaces and larger living areas. This trend is reshaping the real estate market, making suburban living more attractive. People are looking for homes that not only provide space for work but also include amenities like gyms and outdoor areas.
As more people work from home, the demand for high-quality, ergonomic home office furniture has surged. Retailers such as Finnish Design Shop have seen a rise in sales of desks, office chairs, and storage solutions, reflecting the need for comfortable and functional workspaces.
Investing in properties with home office spaces could be a smart move, as more Finns embrace remote work. This trend is not just about convenience; it's about creating a productive and enjoyable work environment at home.
Suburban areas are becoming more popular because they offer the space and amenities that remote workers desire. Homes with dedicated workspaces are in high demand, and this is influencing the types of properties that are being developed and sold.
For those considering buying property in Finland, understanding these trends can be crucial. The shift towards remote work is not just a temporary change; it's a significant factor in the real estate market, with long-term implications for property values and demand.
Sources: Helsinki Times, Finnish Design Shop
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.
15) Avoid properties with shared saunas, as they may be less attractive to renters or buyers who prefer private amenities
In Finland, private saunas are becoming a hot commodity.
According to a survey by YIT, over half of Finns would rather have a sauna in their apartment, even if it means giving up some living space. This highlights a strong desire for the convenience and privacy that private saunas offer. Imagine coming home after a long day and having your own personal retreat, without the need to schedule or share with others.
The real estate market is catching on, with properties featuring shared saunas often selling slower or at lower prices. Buyers are increasingly prioritizing the privacy and ease of having their own sauna. Property management companies echo this sentiment, noting that tenants prefer private amenities for the comfort and flexibility they provide.
Rental properties with shared saunas are also feeling the pinch, as they tend to have higher vacancy rates. Renters are on the lookout for the privacy and convenience that only a personal sauna can provide. Real estate agents have noticed a hesitancy among buyers when it comes to shared amenities, further underscoring the demand for private saunas.
For those considering a property purchase in Finland, it's worth noting that shared saunas might not be as appealing to potential renters or future buyers. The trend is clear: private saunas are in, and shared ones are losing their charm.
So, if you're eyeing a property, think about the long-term appeal of having a private sauna. It could be a key factor in both your enjoyment and the property's value.
16) Consider properties with private gardens or balconies in Finland, as locals highly value privacy
In Finland, privacy is a top priority for many homebuyers.
You'll notice that properties with private gardens or balconies are in high demand. These spaces offer a peaceful escape from city life, making them especially attractive in urban areas. Young professionals, in particular, are keen on having a private outdoor area to unwind.
Developers in Finland are catching on to this trend, focusing on creating homes that emphasize privacy. For example, islands like Hanhisaari and Teerisari are popular because they offer serene retreats with private outdoor spaces. These spots are perfect for those looking to relax away from the hustle and bustle.
Homeowners often share that having a private garden or balcony is essential for their personal space and relaxation. This preference is reflected in the market, where such features can significantly boost property values.
In cities, having a private outdoor area is not just a luxury but a sought-after feature. It provides a much-needed break from urban life, making properties with these amenities more desirable.
So, if you're considering buying property in Finland, keep in mind that privacy-focused features like gardens and balconies are highly valued. They not only enhance your living experience but also add to the property's worth.
Sources: MDPI, Island Seeker
17) Understand that in Finland, buying shares in a housing cooperative means you don’t own the property directly, affecting your rights and responsibilities
In Finland, buying a home means purchasing shares in a housing company rather than the property itself.
This unique system means that when you buy a home, you're actually acquiring shares that give you the right to live in a specific apartment. It's a setup that can significantly impact your rights and responsibilities as a homeowner. The cooperative model is deeply rooted in Finnish society, with a history stretching back to the 1950s, and it continues to evolve.
By 2018, about 90% of Finns were members of a cooperative, showing how widespread this arrangement is. With over 4,045 cooperatives in Finland as of 2020, it's clear that a large portion of Finnish residents live in housing cooperative setups. This high membership rate indicates the popularity and trust in this system.
The International Cooperative Alliance (ICA) member organizations in Finland provide detailed information on the rights and responsibilities of shareholders in these housing companies. This legal framework ensures that shareholders are well-informed about their roles and obligations. However, the financial implications of buying shares in a housing company can be sensitive to market dynamics.
Interest rate changes have recently led to a decline in housing transactions and construction. This is something to keep in mind if you're considering buying shares in a housing company. The market can be unpredictable, and these fluctuations can affect your investment.
Sources: Coops4Dev, Bank of Finland Bulletin
Make a profitable investment in Finland
Better information leads to better decisions. Save time and money. Download our guide.
18) Expect slower sales in smaller Finnish towns, as the stable market may impact liquidity
The Finnish real estate market is known for its remarkable stability, even during challenging times.
In 2023, the number of property transactions hit a low not seen since 2013, but this was more about the economic climate than any inherent market instability. If you're eyeing properties in smaller towns, be prepared for a longer wait to sell, as these areas often have slower market activity compared to bustling Helsinki.
Helsinki's real estate scene is buzzing with active buyers, while smaller towns face a different reality. The slower pace in these areas is partly due to stagnant or declining populations, which naturally impacts demand. This means properties might sit on the market longer, affecting liquidity.
Economic factors like interest rates and wage growth are key players in this scenario. Lower mortgage rates can spark demand, especially in cities with vibrant economic activity. However, in smaller towns, this effect is muted, leading to extended selling periods.
For those considering a move to Finland, understanding these dynamics is crucial. While urban areas might offer quicker transactions, rural properties require patience. The market's stability is a plus, but knowing where and when to buy can make all the difference.
Sources: HPP Attorneys, Centrarium, SKVL
19) Consider properties with good insulation and renewable energy in Finland, as energy efficiency is a key selling point
In Finland, energy efficiency is a major selling point for properties.
The Finnish government has been ahead of the curve, setting high energy efficiency standards since 1976. Over the years, these standards have evolved, with the 2018 building code pushing for renewable energy sources and district heating. This means homes are not just warm but also eco-friendly.
Finns are increasingly aware of the perks of energy-efficient homes, like environmental benefits and cost savings. This awareness is driving demand, with more buyers on the lookout for properties that tick these boxes. The government sweetens the deal with incentives like state subsidies and favorable tax regulations for low carbon emissions, making energy-efficient upgrades a no-brainer.
Energy Performance Certificates (EPCs) are a must for new buildings and when selling or renting existing ones. This certification highlights a property's energy efficiency, often boosting its market value. Buyers are keen on homes with good insulation and renewable energy, which tend to have higher resale values.
Sources: Implementation of the EPBD in Finland, RES Legal, Valtioneuvosto
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.
Related analyses:
- Forecasts and predictions for the real estate market in Finland
- The hottest real estate markets in Finland
- The strongest trends for real estate in Finland
- Why you should consider investing in property in Finland
- Overview of the current state of the real estate market in Finland