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What is happening in Finland’s real estate market? Are prices rising or falling? Is Helsinki still a prime location for international buyers? How are Finland’s government policies shaping real estate taxes and regulations in 2025?
These are the questions we hear every day from industry experts, homebuyers, and sellers across Finland, from Turku to Rovaniemi and beyond. You might be curious about these trends too.
We understand this because we stay closely connected with local experts and individuals like you, exploring the Finnish real estate market daily. That’s why we crafted this article: to deliver clear insights, thoughtful analysis, and a comprehensive view of market trends and dynamics.
Our aim is straightforward: to make sure you feel informed and confident about the market without needing to search elsewhere. If you think we missed something or could improve, we’d love to hear your feedback. Feel free to reach out with your thoughts, and we’ll strive to enhance this content for you.
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1) Russian buyers will reduce their presence in Finland’s market due to geopolitical tensions
Russian buyers are pulling back from the Finnish property market due to geopolitical tensions.
The Finnish government is considering a ban on Russian nationals purchasing property, a move driven by security concerns. This proposal could drastically cut down the number of property deals involving Russian buyers. The idea is to protect national interests, especially in light of recent global events.
Finland has already put laws in place to block real estate transactions on national security grounds, directly impacting Russian buyers. This is part of a larger effort to limit foreign ownership, particularly from Russia. The legislation aims to deny permits for real estate purchases to those from countries that violate another state's territorial integrity.
Media coverage of the tensions between Finland and Russia, especially after the Ukraine invasion, has been intense. This has led to increased scrutiny and negative publicity, which might discourage Russian investors from entering the Finnish market. Real estate agents have noticed fewer inquiries from Russian clients, reflecting this trend.
These geopolitical issues are not just political; they have real-world impacts on the property market. The decline in Russian interest is a clear sign of how these tensions are affecting business. The Finnish market is adapting to these changes, focusing more on other international buyers.
Sources: Business Insider, Jurist, Euronews
2) Rental yields in smaller Finnish towns will decrease as population growth slows
In smaller Finnish towns, rental yields are expected to decline as population growth slows.
Since 2020, Finland has seen a negative natural population increase, with a notable drop in 2023. This means fewer people are being born than are passing away, which directly affects the number of potential renters in these areas.
Adding to this, there's a strong migration trend where people are leaving rural areas for cities. For instance, 80,000 new residents moved to the Helsinki region last year, which means fewer people are looking to rent in smaller towns.
Finland's economy isn't helping either. The country's economic growth has been sluggish, with the GDP showing a decline in 2024. This slow growth means fewer job opportunities, especially in smaller towns, making them less attractive for potential renters.
In these smaller towns, the combination of fewer births, more people moving to cities, and a slow economy is creating a perfect storm. Rental yields are taking a hit because there simply aren't enough people looking to rent.
For anyone considering buying property in these areas, it's crucial to understand that the demand for rentals is decreasing. This trend is expected to continue as long as these factors remain unchanged.
Sources: Statistics Finland, Yle, Bank of Finland Bulletin
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) University towns will maintain stable rental yields thanks to steady student demand
In Finland, university towns are hotspots for stable rental yields thanks to a steady stream of students.
With 168,000 students enrolled in 2023, Finnish universities saw a 2.7% bump from last year, ensuring a constant demand for nearby rentals. This growing student population is a key driver for the rental market, especially in cities like Oulu, where the tech industry attracts both students and young professionals.
In 2023, 33,000 new students joined the ranks, marking a 1.2% increase. Oulu, in particular, is thriving with its tech scene, which supports high rental yields. The demand for student housing is clear from the record-breaking 61,000 applications for higher education, nearly double from 2022, pointing to low vacancy rates.
Historically, university towns have shown stable or rising rental yields. Oulu boasts an average gross rental yield of 5.24%, with some areas hitting 7%. Tampere and Lahti also enjoy significant yields, thanks to their tech industries and student influx. The Finnish Associations of Student Housing Organisations highlight the struggle to meet this high demand, fueled by rising living costs and international students.
In Tampere and Lahti, the tech boom and student numbers are driving rental yields. The Finnish Associations of Student Housing Organisations report challenges in meeting the high demand for student housing, a situation exacerbated by cost-of-living increases and international student numbers.
Sources: Statistics Finland, GSL Global, Housenix
4) Foreign buyers will increasingly target Finnish properties for the country’s stable economy
Foreign buyers are eyeing Finnish properties thanks to the country's stable economy.
In 2023, Finland's economy started bouncing back from a recession. With low inflation and a steady rise in consumer spending, the country is becoming a magnet for investors. This economic stability is a big draw for those looking for a safe bet in the property market.
Finland is also known for being one of the safest places to live. Ranked as the fifth safest country in the world by Global Finance, it offers a high standard of living and low crime rates. These factors make it a secure and appealing choice for foreign investors.
Foreign direct investment in Finland saw a significant boost in 2023, reaching EUR 81.6 billion by year's end. This surge was mainly due to corporate acquisitions and reinvested earnings, showing strong interest from abroad. More real estate agencies are now catering to international buyers, and Finnish properties are gaining traction on global platforms.
With its stable economy and safe environment, Finland is becoming a hotspot for property investment. The country's exceptional social welfare system and reliable market conditions are key attractions for foreign buyers.
Sources: Statistics Finland, Global Finance, Bank of Finland Bulletin, Global Citizen Solutions
We believe this video, 'FRV breaks into Nordics with plans to develop 600 MW,' indicates a stable economy that continues to attract foreign buyers to Finnish properties.
5) Helsinki’s rental yields will rise as demand for rental properties exceeds supply
Helsinki's rental market is heating up, with rental yields on the rise due to increasing rental prices.
In 2023, the average gross rental yield in Helsinki was already at 3.80%, a clear sign of this upward trend. The city's population is growing rapidly, expected to surpass 700,000 by 2027, which is pushing up the demand for housing.
There's a noticeable shortage of rental properties in Helsinki, with a low apartment vacancy rate. This scarcity allows landlords to charge higher rents, boosting rental yields. Even though areas like Pohjois-Pasila and Jätkäsaari have seen some growth in residential units, it's not enough to meet the needs of the rising population.
In 2023, Helsinki experienced a population boom, adding over 10,000 new residents, a level of growth not seen since the 1960s. This surge is largely fueled by international migration, which continues to drive demand for rental properties.
Looking ahead, projections suggest that Helsinki's population will reach 722,000 by 2040, further straining the housing market and pushing rental yields even higher. This trend is particularly notable as the demand for rental properties outpaces supply.
Sources: Global Property Guide, Helsinki Times, DWS
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6) Remote work trends will boost demand for homes with dedicated office spaces
In Finland, 35% of wage and salary earners worked remotely in 2023, making it a leader in Europe for remote work.
This shift has sparked a growing demand for homes with extra rooms or larger spaces, as people look for dedicated office areas. Real estate listings now often highlight these features, showing how homebuyers are prioritizing flexibility for remote work.
Architects are seeing more requests for custom home office designs, as homeowners want to create comfortable and efficient workspaces. This trend is reshaping how homes are designed and marketed.
Sales of home office furniture are booming, with companies like Finnish Design Shop and Martela reporting increased demand for ergonomic pieces. People are investing in quality setups to enhance their work-from-home experience.
In Finland, the remote work trend is not just a temporary shift; it's influencing how people choose and design their homes. The need for dedicated office spaces is becoming a key factor in real estate decisions.
As more people work from home, the market for ergonomic office furniture continues to grow, reflecting a broader change in lifestyle and work habits.
Sources: Statistics Finland, Finnish Design Shop, Helsinki Times, Martela
7) Government initiatives will boost affordable housing development in urban areas
Government initiatives are key to boosting affordable housing in Finland's urban areas.
In Finland, the government has been proactive, investing over EUR 270 million in affordable housing from 2008 to 2019. This was part of the Housing First policies, which aimed to tackle homelessness and make housing more accessible. These efforts have been particularly impactful in urban regions, where the need for affordable housing is most pressing.
Take the Uusimaa region, for example, where the population density is about 193 people per square kilometer. This growing urban density underscores the demand for affordable housing. The Finnish government responded with the Housing First strategy, which impressively cut long-term homelessness by 68% from 2008 to 2022. This strategy has been a game-changer in addressing housing needs.
Public-private partnerships have also played a significant role. The Y-Foundation, a non-profit landlord, is a key player in the Housing First Development Network. They receive discounted loans from the state to purchase properties, which are then rented to those experiencing homelessness. This collaboration has been vital for the success of affordable housing projects.
Such partnerships between the government and non-profit organizations have been instrumental in making affordable housing a reality. The Y-Foundation's model shows how effective these collaborations can be. By working together, they have managed to provide housing solutions that were previously out of reach.
These initiatives are not just about building homes; they're about creating sustainable communities. The Finnish approach demonstrates how targeted government policies and strategic partnerships can address urban housing challenges. It's a model that other countries might look to for inspiration.
Sources: The Global Economy
8) Stricter short-term rental regulations will affect the profitability of Airbnb-style investments
Regulations on short-term rentals are tightening, and this trend is expected to continue into 2025.
In Finland, there's a new proposal that could give municipalities the power to decide on short-term rentals, except for owner-occupied homes. This means local authorities might soon have more control, potentially limiting how many short-term rentals are available. In Rovaniemi, a city known for its high number of these rentals, officials are worried about how this affects housing and local services. The concern is that short-term rentals are driving up prices and making it harder for residents, like students and seasonal workers, to find housing.
Residents have been voicing their frustrations, complaining about disturbances from these properties. This is part of a larger issue where short-term rentals are seen as a nuisance in many communities. The Finnish government is responding by preparing legislation that would require permits for short-term rental hosts. This would classify non-resident rentals as commercial, aiming to regulate platforms like Airbnb more strictly.
There's been significant public support for these changes, as seen during the public comment period for the draft proposal. People seem to agree that stricter regulations are necessary to manage the impact of short-term rentals on local communities. This shift in policy reflects a growing trend across Europe, where cities are grappling with the balance between tourism and local living conditions.
For potential property buyers, this means considering how these regulations might affect investment opportunities. If you're thinking about buying a property to rent out short-term, be aware that the profitability of such investments could be impacted by these new rules. It's crucial to stay informed about local regulations and how they might change in the future.
Sources: Helsinki Times, Short Term Rentalz
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) Demand for smaller apartments in Helsinki will rise as urbanization progresses
The Helsinki metropolitan area is seeing a significant rise in urban population growth.
By 2040, the population is expected to reach 1.88 million, and by 2060, it could grow to 2.13 million. This means more housing is needed, especially smaller apartments, to accommodate the increasing number of people moving to the city. The trend is clear: as more people flock to Helsinki, the demand for compact living spaces is on the rise.
In recent years, there's been a noticeable increase in single-person households, particularly in Helsinki, which had the highest number of such households in Finland back in 2018. This shift indicates a growing preference for smaller living spaces. Younger folks, in particular, are leaning towards compact living, seeking affordable and convenient housing options.
The scarcity and high cost of larger apartments also play a role in this trend. Real estate market analyses show that the demand for smaller apartments is rising due to the limited availability and high cost of larger living spaces. This scarcity is partly due to the limited availability of prime logistics premises and land, leading to high demand and low vacancies in the housing market.
As urbanization continues, the Helsinki metropolitan area will see increased demand for smaller apartments. The city's growth is reshaping the housing market, making compact living not just a trend but a necessity. For those considering buying property, understanding these dynamics is crucial.
Sources: Helsinki Times, Yle, Europe Real Estate
10) Demand for smaller living spaces will grow as single-person households rise
Single-person households are on the rise in Finland, and this trend is reshaping the housing market.
In 2023, 25.8% of Finns lived alone, and this number is climbing. This shift is particularly evident in bustling urban areas like the Helsinki Metropolitan Area, where housing costs are notoriously high. People are increasingly seeking smaller, more affordable living spaces that fit their solo lifestyle.
The real estate market is adapting to these changes. There's been a noticeable uptick in the sales of smaller properties, which are not only budget-friendly but also cater to the needs of those living alone. Architects are getting creative, focusing on designs that maximize the utility of small spaces, making them both efficient and sustainable.
In Helsinki, for instance, compact apartments are becoming the norm. These spaces are cleverly designed to offer all the essentials without the extra square footage. This trend is not just about affordability; it's about creating a home that feels just right for one person.
Moreover, the demand for these smaller homes is driving innovation in the housing sector. Developers are exploring new ways to make these spaces more livable, incorporating smart technology and sustainable materials. This approach not only meets the needs of single-person households but also aligns with broader environmental goals.
As more people embrace solo living, the market for smaller, well-designed homes is expected to grow. This shift is not just a trend; it's a reflection of changing lifestyles and priorities in Finland.
Sources: Trading Economics, Sciendo, Yle
11) Finnish homebuyers will increasingly focus on sustainability in their housing choices
Finnish homebuyers are increasingly prioritizing sustainability in their housing choices.
One major reason for this shift is Finland's ambitious goal of achieving carbon neutrality by 2035. This has led to stricter building codes that emphasize energy efficiency, pushing the construction industry towards more sustainable practices. As a result, new homes are being built with the environment in mind, making them more attractive to eco-conscious buyers.
There's also a noticeable rise in the sales of eco-friendly building materials across Finland. As people become more aware of their environmental impact, they're opting for materials that help reduce their carbon footprint. This growing demand is reshaping the housing market, with more sustainable options becoming available.
Finland's commitment to sustainability is further evident in the increasing number of green-certified buildings. Areas like Jätkäsaari in Helsinki are leading the way with projects that focus on green development and shared spaces, showcasing the appeal of eco-friendly construction methods.
These trends are not just about regulations; they're about a cultural shift towards valuing the environment. Finnish consumers are looking for homes that align with their values, and the market is responding by offering more sustainable choices.
As the market for sustainable housing grows, it's clear that eco-friendly homes are becoming the norm rather than the exception. This shift is not only beneficial for the environment but also for those looking to invest in properties that will stand the test of time.
Sources: IEA, Statista, Constructive Voices
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12) Finland's aging population will boost demand for accessible housing options
Finland's elderly population is on the rise, with a noticeable increase over the past decade.
From 2013 to 2023, the number of people aged 65 and over in Finland grew by 4.5 percentage points. This trend is expected to continue, and by 2100, nearly a third of the EU's population will be 65 or older. As people live longer, thanks to rising life expectancy, the number of older adults in Finland is growing. This demographic shift brings about specific needs, particularly in housing. Older adults often require homes that are easy to navigate and safe, which means features like step-free access, wider doorways, and other modifications become important.
With more seniors, there's a growing need for homes that are easy to navigate and safe. Think step-free access and wider doorways. Government reports and healthcare studies have highlighted these challenges, leading to more senior-friendly housing developments.
Finland is seeing a boom in construction for senior-friendly housing, reflecting the demand for accessible options. Policy initiatives in Finland have also focused on promoting age-friendly communities, which include accessible housing as a key component. These efforts are part of broader strategies to address the needs of an aging population, ensuring that older adults can live comfortably and independently for as long as possible.
Policy initiatives in Finland are pushing for age-friendly communities, with accessible housing as a key focus. These efforts aim to help older adults live comfortably and independently for as long as possible. Finland's strategy is all about making life easier for its aging citizens.
Sources: Eurostat, OECD, Tandfonline
13) Demand for properties with strong insulation and reliable heating will grow due to climate change
In Finland, energy efficiency in homes is becoming a top priority.
With the Finnish government pushing for emission-free buildings by 2030, new building codes are setting higher energy efficiency standards. Homeowners are now more inclined to invest in robust insulation and heating systems thanks to financial incentives. This shift is not just about saving money; it's about preparing for a future where energy efficiency is crucial.
As energy costs rise, people are looking for ways to cut down on expenses. In 2023, Finland saw a significant drop in emissions from the trading sector, thanks to a move towards cleaner energy sources like nuclear and wind power. This change has made consumers more conscious of the benefits of well-insulated homes, as highlighted by initiatives like "Kuluttajien energianeuvonta," which focuses on promoting energy efficiency in housing.
Climate change is also playing a big role in this shift. Media reports and academic research have shown that Finland is experiencing more extreme weather events, which means increased heating needs. As a result, there's a growing demand for properties that can withstand these conditions, offering better protection and comfort.
For those considering buying property in Finland, it's worth noting that homes with strong insulation and efficient heating systems are becoming more desirable. This trend is driven by both economic factors and the need to adapt to changing climate conditions. Investing in such properties not only makes financial sense but also ensures a more sustainable and comfortable living environment.
So, if you're in the market for a new home, consider the long-term benefits of energy efficiency. It's not just about meeting current standards; it's about future-proofing your investment against the challenges of climate change.
Sources: Castren, CA EPBD, IEA
14) Rovaniemi will draw more investors as its popularity as a winter tourism spot grows
Rovaniemi, the heart of Finnish Lapland, is quickly becoming a top destination for winter tourism.
In 2023, the city saw a 30% jump in overnight stays, welcoming 1.2 million visitors. This surge is not just a one-time event; experts predict similar numbers for 2025, making it a promising spot for investors.
With more tourists, hotels and rentals are thriving. Short-term rentals in Rovaniemi boast a 68% occupancy rate, with properties booked for 248 nights annually. This demand peaks during the winter months, when accommodations are often fully booked.
Rovaniemi's accessibility has improved significantly, thanks to the expansion of flight routes. In 2024, the airport added 13 new connections, now linking to 35 cities in 17 countries. This has opened the doors to tourists from across Europe, further boosting visitor numbers.
Investors are taking note of these trends, as the city's growing popularity promises lucrative opportunities. The local tourism industry is thriving, with the influx of visitors supporting a vibrant economy.
Rovaniemi's charm, combined with its strategic improvements in accessibility, positions it as a prime location for investment. The city's ability to attract tourists year after year is a testament to its enduring appeal.
Sources: Travel and Tour World, Airbtics, Euronews
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) Property demand in Jyväskylä will grow as it emerges as an education and research hub
Jyväskylä is quickly becoming a sought-after destination for education and research, which is boosting property demand.
The University of Jyväskylä is a major draw, with around 14,000 students and 2,800 new students enrolling each year. This influx of students creates a significant need for housing, making it one of Finland's most popular universities. The city is not just about education; it's also investing heavily in research facilities, which is part of its urban strategy to enhance business conditions.
These investments are attracting more researchers and students, boosting the local economy and increasing housing demand. Jyväskylä is also becoming a hub for academic conferences, drawing scholars from around the globe. This international interest strengthens its reputation as an educational center.
New residential areas are being developed, like the student village Kortepohja, which is conveniently located near the city center and educational institutions. The local government is actively supporting businesses and educational talent, making Jyväskylä an attractive place for companies to set up R&D centers.
With these developments, Jyväskylä is set to continue its growth as a center for education and research. This growth is expected to lead to a sustained rise in property demand, as more people move to the city for work and study.
Sources: Elinkeinopalvelut Jyväskylä, Jyväskylä Student City, Wikipedia
16) Energy-efficient technologies will be a major selling point for homes in Finland
Energy-efficient technologies are now a major selling point for Finnish homes.
Why? Well, since 2021, energy costs in Finland have been climbing fast, thanks to global and geopolitical factors. This has hit household electricity and heating bills hard, pushing homeowners to find ways to cut down on these expenses.
The Finnish government is stepping in with incentives to help. They've rolled out a loan guarantee program to support energy-efficient home upgrades, like renewable heating systems. This makes it easier and more appealing for homeowners to invest in these solutions.
Finnish folks are also getting more eco-conscious. They're prioritizing sustainable living, which is boosting demand for energy-efficient appliances and smart home tech. These gadgets not only save energy but also make life more convenient and comfortable.
Plus, Finland's building regulations are getting stricter, focusing on energy efficiency. The country is moving towards using bioenergy and waste heat for heating, which aligns with the trend of sustainable homes.
Energy performance certificates are now a thing, too. They give homeowners and buyers a clear picture of a property's energy efficiency, making these features a big deal in the market. Homes with these technologies are likely to see a bump in resale value, especially as Finland's population ages and sustainable living becomes more crucial.
Sources: IEA, NextMSC, Statista
In this video, we see Finland's commitment to energy efficiency through the Varanto project, a massive thermal energy storage facility set to start operations in 2024. This supports the statement that energy-efficient technologies are becoming key for Finnish homes.
17) Properties in towns connected by Finland's expanding rail network will become more attractive
The expansion of Finland's rail network is making properties in connected towns more attractive.
Take the Jokeri Light Rail in the Helsinki region, for example. Properties within 800 meters of its stops have seen a 5% increase in apartment prices compared to those farther away. This clearly shows how being close to rail lines can significantly boost property values.
There's also a growing demand for homes in areas with better rail access. In places like Espoo and Helsinki, just the anticipation of new rail lines has already sparked increased interest in housing. People are keen to live where they can easily hop on efficient transportation.
Projects like the Luumäki-Imatra(-Simpele) section doubling are set to cut down commute times, making daily travel more convenient. This improvement in the rail system's efficiency is a major attraction for potential homebuyers who value shorter commutes.
Insider tip: As these rail projects progress, expect a ripple effect on local businesses too. New cafes, shops, and services often pop up around these transport hubs, adding to the area's appeal. This means that investing in property near these lines could also mean access to a vibrant community.
For those considering a move, it's worth noting that these rail expansions are part of a broader strategy to enhance Finland's infrastructure. This not only boosts property values but also strengthens the country's overall competitiveness and growth potential.
Sources: Journal.fi, RT.fi
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.
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