2010 Saw A Total Of 41,608 Real Estate Deals In Estonia

The land registry in Estonia  has reported that 2010 saw some 41 608 real estate deals for the whole of Estonia, according to Tõnu Toompark’s blog. This figure was apparently roughly divided equally between land sales and apartment ownership sales.

Worth noting is the fact that of  20 343 apartment ownership sales, 2 875 were for non-residential apartment ownership.

Land sales were divided almost equally between developed building land (9 233 sales)  and undeveloped land (11  529) in 2010.

Total turnover in real estate for 2010 came to 1.48 billion Euros (23.3 billion Kroons).

About a third of this figure was accounted for by apartment ownership sales, which totaled 583 million Euros (9,116,000 Kroons), according to the report.

These figures represent only a very slight increase on 2009.

For detailed charts showing the breakdown of numbers and value (in Euros) of real estate transactions by type, from 2004-2010 inclusive, see Tõnu’s blog article (Estonian only).

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No Signs That Euro Adoption In Estonia Has Led To Surge In Property Prices – Yet

The recent adoption of the Euro in Estonia has not led to an immediate rise in residential real estate prices, according to Tõnu Toompark’s blog, adaur.ee (in Estonian). Citing real estate portal KV.ee’s own index for residential real estate prices, which yesterday settled at a figure of 61.9, a mere 3 per cent lower than the value for the same time last year, Tõnu states that this shows that real estate has been immune to the previously-feared upward pressure on prices, as people ’round up’ figures directly converted from Kroons to Euros.

Both offer prices and number of offers show that nothing significant happened during recent weeks. The total number of offers on real estate has increased slightly, to 18 879 offers on the KV.ee site, which represents minor changes, says Tõnu.

Put simply, it could be said that apartment prices both in Tallinn and the whole of Estonia are at a somewhat higher level than the previous month and the previous year in general, he writes.

Nevertheless, as Tõnu points out this is rather preliminary and scanty data. Indeed, the adoption of the euro could later result in some more far reaching impact on real estate transactions, and the number of bids and transactions might be more active in a month or two, he says.

The KV.ee index, which began on 18 February 2008 (i.e. this is the date on which the value of the index is calibrated at 100) measures the week on week change in residential real estate prices in Estonia. The data js  measured  back retrospectively to 1 January 2005, when the index stood at an all time low of 49.9. The all time high came on 7 May, 2007, when it stood at 108. Following the economic downturn of 2008 onwards, the index reached a low point (to date) of 61.4 on two occasions, on 5 September and 27 October, 2010..

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Goodbye Kroon, Hello Euro – Practical Info On Estonia’s New Currency

The introduction of the Euro to Estonia on 1 January took place quite smoothly and with no major mishaps. Cash machines were closed from midday on 31 December, 2010 until the stroke of the new year 12 hours later, which may have left visitors and those unprepared for the new currency at a loose end for cash, but debit and credit cards could still be used to make transactions in the outgoing currency.

According to the European Central Bank site, Estonian Kroons could in fact be used as legal tender in cash transactions until 15 January. Retail outlets however gave change in Euros in such cases, and payment in Kroons seems to have been the exception almost from the beginning, as people use up all the spare cash they had at home.

All is  not lost if you should find some forgotten Kroons in a biscuit tin under the bed however; until 30 June 2011, all banks that offer cash services (i.e. all the highstreet banks) will exchange Kroons (both notes and coins) for Euros, and at a limited number of branches this service will continue to the end of 2011. Should a year not prove enough time to rid yourself of the former currency, the National Bank (Eesti Pank) will continue to accept Kroon notes and coins in exhange for euros indefinitely, according to the ECB site.

The Estonian Kroon (EEK), introduced on 20 June, 1992 to replace the Soviet Rouble, had been pegged to the Euro since 27 June, 2004 after Estonia’s accession to the EU. The rate of exchange was 1 EUR : 15.64664 EEK – this rate remained constant despite the threat of devaluation during the recent economic crisis, and remains the basis on which Kroons will be exchanged for Euros.

We hope to keep you updated in the near future about further effects of the Euro (for example concerning company share capital) so please be sure to check the blog regularly!

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No Change in Value For Construction In Estonia

According to the Statistical Office in Estonia, construction output volume for the third quarter of 2010 came to a value of 364.6 million Euros . This figure is almost the same as that for the corresponding quarter in 2009 (371.3 million euros) and could be contrasted with the figure for the last year of the boom period, 2007, where construction output value stood at 747.1 million euros in the same quarter.

It would seem then that we will have to wait a little longer for evidence of recovery to make itself known in the construction sector.

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Tallinn Real Estate Market Report December 2010

To wrap-up 2010 and look ahead to 2011, please don’t hesitate to check our latest Tallinn Property and Rental Market Quarterly Review.

As always our review contains an in-depth look at the Tallinn residential market, the situation regarding mortgage loans, information on average asking and transactional prices, the current state of the central Tallinn rental market, and also offers invaluable sample transactions and advice on rental business considerations.

You can find the full report at: http://www.goodsonandred.com/sharedfolder/tallinn-property-market/marketreview-tallinn-real-estate-q4-2010_web151210.pdf

We would very much like to hear your views regarding the Tallinn or Estonian property market. Furthermore, if you have any suggestions regarding topics, please do not hesitate to leave your comment or tweet us, or write on our wall.

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