Economy
AI
Estonia's New Apartment Sales Plunge in December
New apartment sales in Tallinn and Tartu collapsed in December 2025, with only 72 and four units sold respectively, as persistently high prices deter buyers despite a traditional end-of-year sales surge.
- —Sales of new apartments in Tallinn and Tartu experienced a substantial decrease in December compared to the previous year, with Tallinn recording 72 sales and Tartu only four.
- —Experts attribute the slowdown to persistently high prices and buyer caution, noting that December, typically a strong sales month, did not see the expected seasonal increase.
- —Despite the current challenges, there are signs of potential market recovery in the coming year, driven by economic stabilization and increased household purchasing power due to changes in the income tax system.
- —An individual with an average salary can now secure a larger mortgage, and for couples, this translates to a significant increase in borrowing capacity, potentially expanding their options for new properties.
Recap
The sharp December downturn in Estonia's new apartment market reveals a sector caught between high construction costs and buyer resistance. An increase in household borrowing power, driven by tax system changes, is setting the stage for a potential demand-led recovery in 2026, shifting market leverage from developers toward newly empowered buyers.