Authored by the expert who managed and guided the team behind the Estonia Property Pack
Yes, the analysis of Tallinn's property market is included in our pack
Why is Tallinn emerging as a prime destination for property investment in 2025? Is it the impressive rental yields, the vibrant tech scene, or the affordability compared to other European capitals? What are the key advantages for investors?
We get asked these questions all the time because we’re on the ground, working closely with developers, real estate agents, and investors like you. With so much interest in this market, we’ve decided to turn our individual answers into a comprehensive article for everyone to benefit from.
Our goal is to provide a clear case for investing in Tallinn's real estate market, backed by our firsthand experience and market knowledge.
If you think we missed an important point in our content or want to know more, don’t hesitate to reach out (we answer super fast). Your feedback makes our content even stronger.
Finally, please note that this is not financial or investment advice. Investing in real estate carries inherent risks, and market conditions can change unexpectedly. We strongly encourage you to conduct thorough research and consult with a qualified financial advisor before making any investment decisions.
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1) Tallinn’s focus on sustainable development boosts property values
Tallinn is boosting property values through its commitment to sustainable development.
The city secured a €100 million loan from the European Investment Bank to revamp urban spaces. This funding has been channeled into projects like school renovations and public space improvements, making the city more appealing and eco-friendly.
Estonia is on a mission to achieve 100% renewable electricity by 2030, pushing Tallinn to adopt green building practices. These efforts have slashed energy costs in certain neighborhoods, making them hot spots for potential buyers.
Tallinn's dedication to sustainability earned it the European Green Capital award, putting it in the spotlight. This recognition has not only enhanced the city's image but also made it a more attractive place to live.
Initiatives like free public transport and better waste management have improved the quality of life, adding to the allure of properties in these areas. These changes are making a noticeable difference in property values.
Sources: Euronews, OECD, European Investment Bank
2) In Tallinn, low property taxes mean higher returns on your investment
In 2023 and 2024, Estonia boasted one of the lowest property tax rates in Europe, making it a hotspot for savvy investors.
Imagine owning property in Tallinn, where property tax revenue is just 0.11% of private capital stock. This is a stark contrast to places like the UK, where the rate is a hefty 1.94%. Such low taxes mean you can enjoy more of your investment returns.
What's even better is that these low tax rates have been stable for years. No sudden hikes have been reported, so you can plan your finances without worrying about unexpected costs. This predictability is a big draw for investors looking for reliable returns.
Investors often highlight the higher returns they get thanks to these low taxes. In Tallinn, rental yields range from 4-6%, which is quite competitive compared to other European cities. This is partly because the property tax is based on land value, not the investment itself, which can be more favorable for property owners.
For those considering a property purchase, the tax system in Tallinn is particularly appealing. It allows for better financial planning and potentially higher profits, making it a wise choice for both new and seasoned investors.
With such favorable conditions, it's no wonder that more investors are turning their attention to Tallinn. The combination of low taxes and stable returns makes it an attractive option for anyone looking to invest in European real estate.
Sources: The Luxury Playbook, Global Property Guide, Euronews, Maakler Expert
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Estonia 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) Tallinn’s growing population means more people need homes
Tallinn's population is on the rise, and it's creating a buzz in the housing market.
With the metro area hitting 458,000 people in 2025, that's a steady climb from the previous year. This isn't just a blip; it's been a consistent trend, showing that more folks are calling Tallinn home. One reason? Estonia's birth rates are ticking up. In 2025, the fertility rate nudged to 1.648 births per woman, a slight increase from 2024. More babies mean more families looking for homes.
But it's not just about babies. Urban living is becoming the thing in Estonia. Back in 2023, the urban population grew by 1.8658%, with many choosing city life over rural settings. Tallinn, with its vibrant city vibe, is a top choice for these urban seekers. Surveys back this up, showing a clear preference for city living among Estonians.
Now, let's talk real estate. Since 2023, property transactions in Tallinn have been on the up. The average price per square meter for homes jumped by about 15%. Apartments, in particular, saw an 11.05% increase year-on-year in early 2024. This price hike is a clear sign of strong demand, fueled by the growing population and the urban shift.
For anyone eyeing a property in Tallinn, these trends are worth noting. The city's growth and the rising demand for housing make it an exciting place to invest. Whether you're looking for a family home or a city pad, Tallinn's got something for everyone.
Sources: Macrotrends, Macrotrends, Trading Economics
4) Tallinn’s Old Town attracts tourists, making it great for short-term rentals
Tallinn's Old Town is a UNESCO World Heritage Site, celebrated for its remarkably intact medieval architecture.
Wandering through the cobblestone streets of Old Town feels like stepping back in time, drawing history enthusiasts and culture lovers alike. This medieval charm is a big reason why tourism in Tallinn is booming, with visitors eager to explore its vibrant cultural scene.
For those considering property investment, short-term rentals in Old Town are hot. A typical listing is booked for 234 nights a year, showing just how popular this area is with tourists. The median occupancy rate stands at 64%, a testament to the area's appeal.
By September 2024, the number of Airbnb listings in Old Town had climbed to 2,136, reflecting a thriving short-term rental market. This growth is fueled by the area's unique blend of history and modern amenities, making it a top choice for visitors.
Investing in Tallinn's Old Town not only offers a slice of history but also a chance to tap into a lucrative rental market. The area's UNESCO status ensures a steady stream of tourists, eager to experience its medieval allure.
Sources: UNESCO, Airbtics, GoKiteTours
5) Tallinn’s efficient public transport makes properties more accessible
Tallinn's public transportation is top-notch, making it easy to get around the city.
With buses and trams running frequently, like the Kaubamaja-Mustamäe trolleybus every nine minutes and Kopli-Suur-Paala trams every five minutes during rush hour, you can count on getting where you need to go without a hitch.
Almost 99% of city center residents have a public transport stop nearby, with services running from early morning until evening, so you’re never far from a ride.
People in Tallinn really rely on public transport, with many using it daily or several times a week. This shows how integral the system is to everyday life, making properties in the area even more appealing.
Living in Tallinn means you can enjoy the convenience of a well-connected city, where public transport is not just an option but a necessity for many, enhancing the value and accessibility of properties.
Sources: Strong Towns, EFGS, SUMBA
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6) Tallinn’s high quality of life draws in expats and long-term residents
Tallinn, Estonia, ranks 17th in the Global Quality of Life Index, making it a top choice for expatriates and long-term residents.
One of the reasons people love Tallinn is its fantastic public transportation system. With buses, trams, trolleybuses, trains, and ferries, getting around is a breeze. The city even extended its night bus lines, so late-night travel is no hassle. This convenience really boosts the quality of life here.
Safety is a big deal in Tallinn, and it shows. The city is ranked 10th globally for personal safety. Most people in the Expat City Ranking survey are happy with the urban environment, praising its peaceful and secure vibe.
Tallinn isn't just about getting around and feeling safe. It's also a hub of culture and recreation. The city offers a rich array of cultural and recreational amenities, from international cuisine to multicultural events, making it a vibrant place to live.
For those who enjoy a diverse lifestyle, Tallinn's multicultural events and international cuisine are a big draw. Whether you're into food festivals or art exhibitions, there's always something happening.
All these factors combined make Tallinn a city that truly offers a high quality of life, attracting people from all over the world to settle down and enjoy what it has to offer.
Sources: Postimees, Wikipedia, Estonian World
7) You’ll find unique waterfront property options along the Baltic Sea coastline
The Baltic Sea coastline offers unique waterfront property opportunities.
After a dip in mid-2022, property values along the Baltic Sea coast have stabilized, with some areas even seeing slight increases in early 2024. This shows a resilient market, making it appealing for potential buyers. For example, in Rostock, the average price per square meter is about €3,864, underscoring its premium status.
There's a growing demand for waterfront properties, especially in the high-price segment starting from €500,000. People are looking for their dream homes at reasonable prices or want to move to more scenic spots. This trend is driven by individuals seeking more desirable locations.
The Baltic Sea region is also a popular vacation spot, which has led to more second-home purchases. The pandemic has made people crave second homes that can double as primary residences, giving the real estate market a boost. Many are now considering these properties as both retreats and main homes.
With its stunning views and serene environment, the Baltic Sea coastline is a dream for many. Buyers are drawn to the unique charm and lifestyle it offers. Whether it's for a holiday home or a permanent move, the area has something special.
Investing in a property here means not just owning a piece of land, but embracing a lifestyle. The blend of natural beauty and modern amenities makes it a sought-after destination.
Sources: Von Poll Real Estate Blog, Coastal Wiki, Von Poll Real Estate Blog
8) In Tallinn, you’ll find less competition in the property market compared to other European capitals
Tallinn's real estate market is less saturated than other European capitals, offering growth potential.
In Tallinn, property prices are relatively low compared to other major European cities. By the end of 2023, the average price per square meter of an apartment was EUR 3,084. While this marks a significant increase, it still remains lower than in many other European capitals.
There's a buzz in the air as population growth fuels housing demand. Both domestic and international migration are driving this trend, pushing property prices and rental yields upward. This growing demand hints at more room for market expansion.
Investors are eyeing Tallinn for its high rental yields compared to other European cities. The rental market is lively, with prices under pressure due to increased supply, suggesting potentially lucrative returns.
The city's tourism industry is on the rise, giving a boost to the short-term rental market. Tallinn's cultural attractions and historical sites are expected to keep drawing visitors, benefiting property owners.
With these factors in play, Tallinn's real estate scene offers a unique opportunity for growth and investment.
Source: Sorainen
We have made this infographic to give you a quick and clear snapshot of the property market in Estonia. 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) Tallinn hosts many international conferences, so short-term rentals are in high demand
Tallinn is buzzing with international conferences, making it a hotspot for short-term stays.
In 2025, the city is set to host several major events, cementing its status as a conference hub. This isn't a sudden change; it's been building up over the years with more conferences popping up annually.
During conference seasons, the influx of attendees is hard to miss. Hotels and short-term rentals are seeing higher occupancy rates, reflecting the strong demand for temporary lodging. For instance, in early 2023, Tallinn's hotels were bustling with a 65% occupancy rate, alongside rising daily rates and revenue per room.
The short-term rental scene is thriving too, thanks to these conference-goers. Property owners are finding it lucrative, as rental yields have climbed. More platforms and listings are popping up, catering to the growing need for short-term stays during these events.
For property investors, this trend spells opportunity. With Tallinn's reputation as a conference destination on the rise, investing in short-term rentals could be a smart move. The city's vibrant conference calendar ensures a steady stream of visitors looking for places to stay.
As the demand for short-term accommodations grows, the market is ripe for new entrants. Whether you're a seasoned investor or new to the game, Tallinn's bustling conference scene offers a promising landscape.
Sources: Baltic Capitals Hotel Market Snapshot 2022, Baltic Hotel Market - Update H1 2023, International Conference Alerts
10) Tallinn’s booming tech industry draws young professionals, increasing demand for housing
Tallinn's tech industry is booming, drawing in young professionals who need housing.
In recent years, Estonian tech companies have paid nearly 170 million euros in labor taxes, almost double from four years ago. This surge highlights the growing number of jobs and people working in tech. The city is buzzing with new opportunities, making it a magnet for tech talent.
Companies like Wise and Bolt are leading the charge, and their success is a beacon for more talent. The value of Estonia's top tech companies remains stable, showing a robust sector. The government is also playing its part by offering start-up visas, making it easier for international entrepreneurs to set up shop in Tallinn.
The influx of young professionals is pushing up the demand for housing. Tallinn's population is set to grow significantly, with many newcomers being tech workers. This has led to rising property prices, especially in tech-centric areas like Telliskivi Creative City, known for its startups and coworking spaces.
Neighborhoods like Telliskivi are buzzing with innovation, and property prices are climbing as more techies move in. The area is a hotspot for creativity and collaboration, making it a desirable place to live and work.
With the tech industry thriving, the city's landscape is changing, and housing is a hot commodity. Young professionals are flocking to Tallinn, eager to be part of its dynamic tech scene.
Sources: Top101, XYZ Lab, OECD, Silicon Republic
11) Tallinn’s thriving startup scene boosts demand for rental homes
Tallinn is buzzing with startups and tech companies, thanks to its friendly business climate and Estonia's innovative e-Residency program.
This program lets anyone worldwide set up and run an EU-based company online, making Tallinn a magnet for entrepreneurs. The Estonian government sweetens the deal by funding incubators, accelerators, and co-working spaces, creating a thriving ecosystem for innovation and collaboration.
Media coverage has painted Tallinn as a major tech hub, drawing in investors and talent. Successful tech companies, especially in fintech and cybersecurity, have set up shop here, cementing Tallinn's reputation as a center for innovation.
The city's rental market is heating up, driven by young professionals and expats who love Tallinn's high quality of life and low cost of living. High occupancy rates in well-connected areas show just how strong the demand is.
Rental prices are climbing due to this demand and limited supply. In 2023, prices jumped significantly, and with Tallinn's low unemployment and strong tech job market, the demand for housing is only going up.
Estonia's economic growth means more disposable income, boosting rental demand. The city hosts international events, attracting professionals who need both short-term and long-term rentals. The expansion of co-working spaces and innovation hubs is a testament to Tallinn's growing startup culture, further driving rental demand.
Sources: Global Citizen Solutions, Sorainen, Support Adventure
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12) The pro-business local government supports economic stability and growth
The local government in Tallinn is pro-business, actively fostering economic stability and growth.
Since 2006, the Tallinn Business Incubator has been a hub for supporting start-up entrepreneurs with bold ideas and export potential. This initiative not only boosts new business registrations but also sparks innovation, making Tallinn a vibrant place for budding businesses. The city's Enterprise and Innovation Strategy further amplifies this by creating better opportunities for enterprise development, enhancing Tallinn's competitive edge.
Tallinn's investment in infrastructure, like transport systems and modern business offices, is a game-changer. These developments are essential for attracting and retaining businesses, ensuring they have the facilities they need to thrive. The city's strategic location and infrastructure make it a magnet for entrepreneurs looking for a supportive environment.
Being part of the EU and OECD, Estonia offers a business-friendly regulatory environment that promotes economic growth. This membership provides a stable framework for businesses to operate smoothly, making Tallinn an attractive destination for investors.
With a focus on innovation and infrastructure, Tallinn is not just a city but a launchpad for success. The local government's initiatives are paving the way for a dynamic business landscape, where opportunities are ripe for the taking.
Whether you're a start-up or an established company, Tallinn's pro-business policies and strategic investments make it a compelling choice for your next venture.
Sources: Intelligent Cities Challenge, Wikipedia
13) Government-backed innovation boosts the economy and increases housing demand
In Estonia, government support for innovation is driving economic growth and boosting housing demand.
In 2023, Estonia invested €702.19 million in research and development, which is about 1.8% of its GDP. This isn't just a number; it's part of a bigger plan to make Estonia a hub for innovation and entrepreneurship. The country is becoming a magnet for tech enthusiasts, thanks to its focus on digitalization and green initiatives.
Estonia's tech scene is buzzing, with the fintech sector growing from 264 companies in 2022 to 310 in 2023. This boom is fueled by the digital economy, which is a key driver of growth. The government is making it easier for startups to thrive by offering incentives like a legal sandbox, where UK startups can test new regulations without the usual red tape.
All this innovation is making cities like Tallinn hot spots for housing. The demand for homes is rising as people flock to these areas for job opportunities and a lively community. With tech companies and startups setting up shop, property prices are likely to climb as more people want to be part of these vibrant ecosystems.
Estonia's focus on innovation isn't just about tech; it's about creating a dynamic environment where businesses can grow. This approach is attracting talent and investment, making the country a desirable place to live and work. The government's efforts are paying off, as seen in the growing number of tech hubs and the increasing demand for housing.
For anyone considering buying property in Estonia, now might be the time to act. With the government's continued support for innovation, the economic landscape is set to keep evolving, offering exciting opportunities for both investors and residents.
Sources: UK Government, European Commission, Global Finance
14) Tallinn’s advanced digital infrastructure makes it a top choice for remote workers
Tallinn is a top choice for remote workers due to its cutting-edge digital infrastructure.
With average internet speeds of 59.5 Mbps, Tallinn ensures that remote work is smooth and uninterrupted. This speed is not just a number; it means you can video call, upload large files, and stream without a hitch.
In Tallinn, you'll find plenty of co-working spaces like Workland and Baltic Cowork. These places offer modern amenities such as high-speed internet, meeting rooms, and hot desks, making them perfect for those who need a flexible workspace.
Estonia's government is forward-thinking, with initiatives like e-Residency that make it easier for remote workers to handle business from anywhere. This program is a game-changer, allowing you to manage your work seamlessly across borders.
The city is also involved in smart city projects, like the "Test in Tallinn" program, which highlights its dedication to improving urban services. This means enhanced quality of life through innovative solutions, making it an attractive place to live and work.
For remote workers, Tallinn's digital infrastructure is a major draw, offering a reliable and efficient environment to get things done. The city's commitment to digital advancement makes it a standout choice for those looking to work remotely.
Sources: Local Nomads, Complex Discovery
We made this infographic to show you how property prices in Estonia 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) Tallinn’s location makes it a key gateway to the Baltic countries, boosting its strategic importance
Tallinn is a bustling trade hub thanks to its prime spot on the Baltic Sea.
The Port of Tallinn is always buzzing, handling a massive amount of cargo. This includes goods traded with neighbors like Latvia and Lithuania, which shows how crucial it is for regional trade. The port's activity is a testament to Tallinn's role in connecting the Baltic countries.
Getting around Tallinn is a breeze with its top-notch public transport. Buses, trams, and trolleybuses make city travel easy, while Elron trains and ferries to nearby islands boost connections to neighboring countries. This seamless transport network is a big plus for anyone considering a move here.
Foreign investments are pouring in, especially from Sweden and Finland. These Scandinavian countries are major players, with their companies making up a large chunk of Estonia's foreign direct investment. This influx of capital strengthens economic ties within the Baltic region, making Tallinn an attractive spot for business.
For those eyeing property in Tallinn, it's worth noting the city's strategic importance. Its location not only makes it a trade powerhouse but also a gateway to other Baltic countries. This enhances its appeal for both living and investing.
With its vibrant economy and excellent transport links, Tallinn is more than just a city; it's a key player in the Baltic region. Its strategic position and economic vitality make it a compelling choice for potential property buyers.
Sources: Public Transport in Tallinn, Scandinavian FDI in the Baltics, Tallinn Economy
16) Tallinn’s location makes it easy to reach major European cities, boosting its appeal
Tallinn's prime location makes it a hot spot for easy travel to major European cities.
With direct flights from Tallinn Airport to places like Berlin, Stockholm, Helsinki, and Amsterdam, getting around Europe is a breeze. This connectivity is a big draw for tourists and business travelers alike, making Tallinn a go-to destination.
Recently, Tallinn has become a magnet for international business conferences and events, pulling in professionals from all over Europe. This shift shows that Tallinn is gaining ground as a business hub, with more multinational companies setting up shop here. These companies not only boost the local economy but also make Tallinn a prime spot for international business ventures.
Getting around Tallinn is a cinch thanks to its efficient public transportation system, which includes buses and trams. The city is pushing to cut down on car use by 2035, aiming to be a sustainable travel destination. This commitment to sustainability, along with top-notch public services, makes Tallinn a desirable place for expats and tourists.
Living in Tallinn means enjoying a high quality of life, supported by excellent public services. This, combined with its strategic location and business opportunities, makes it a top choice for those looking to relocate or invest in property.
Whether you're visiting for business or pleasure, Tallinn's mix of accessibility, sustainability, and quality of life makes it a standout city in Europe.
Sources: ETIAS, Global Citizen Solutions, Eurocities
17) Tallinn’s strong healthcare system makes it ideal for retirees looking for a permanent home
Tallinn's healthcare system is a top choice for retirees seeking a permanent home.
One reason is its impressive international ranking. In 2023, Estonia's healthcare system was ranked 37th globally, far ahead of the United States at 69th. This shows the quality and efficiency of healthcare services in Tallinn.
Specialized medical services are another draw. Tallinn has a well-organized network of independent general practitioners and secondary healthcare services. The two largest hospitals in the city provide half of the specialist services, ensuring retirees have access to a wide range of medical care.
Affordability is a big plus. Compared to other European cities, healthcare costs in Tallinn are more budget-friendly. This means retirees can enjoy quality medical care without breaking the bank.
Combining affordability with high-quality services, Tallinn becomes a desirable spot for a secure retirement. The city's healthcare system is not just efficient but also accessible, making it a smart choice for those looking to settle down.
With its robust healthcare system, Tallinn offers peace of mind to retirees, ensuring they have the support they need for a comfortable life.
Sources: Vagabond Buddha, OECD
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.