In June, according to the data, the prices of condominiums in Helsinki fell by 1.2 percent from a year ago and in the capital region by 1.9 percent from a year ago. On the other hand, the prices of apartments with at least three rooms rose by 1.4 percent in Helsinki and by 2.1 percent in the capital region.
The increase in the prices of apartments in old housing associations slowed down to 0.5 percent not only in the capital region, but also in Finland’s six largest cities. In Turku, prices fell by five percent from the previous year, but rose by 4.5 percent in Tampere. Prices rose more than average outside the six largest cities, 2.7 percent from the previous year.
The prices of new housing association apartments in the capital region rose by 3.2 percent from a year ago. In the capital region, the prices of terraced houses rose by 1.9 percent.
According to Statistics Finland, the sale of new apartments slowed down significantly in the region and fell by 65 percent from 1,122 in the second quarter of 2021 to 383 in the second quarter of 2022. The slowdown was even more dramatic in Helsinki, where sales dropped 71 percent from 444 to 128 a year ago.
Nationally, sales of new apartments decreased by 45 percent in April-June compared to the previous year, making Oulu the only municipality where sales volumes increased.
Risto KyhäläThe CEO of Kiinteistömaailma told Helsingin Sanomat that several factors explain the decline in the prices of studio apartments and the slower rise in the prices of larger houses.
People looking for a rental apartment have become more quality-conscious and have started to reject poorly equipped or poorly maintained houses. The demand for old small apartments has therefore decreased, which has led to an increase in the supply of old small apartments and a decrease in prices.
The demand for small houses in the capital region was already affected by the coronavirus pandemic, and it is not yet returning to the pre-pandemic level.
In turn, consumer confidence has fallen to a record low level and, according to Kyhälä, it will inevitably affect the sale of real estate, regardless of the size of the house. Another factor causing people to rethink their plans is the rising cost of living.
“We have experienced unprecedented increases in housing prices in large growth centers, and now we are in a situation where prices have reached the peak of purchasing power,” he sums up.
Kyhälä added that the demand has continued for modern and energy-efficient houses, the earliest built in 2005, which utilize new energy solutions, such as solar power or geothermal energy. However, older houses are seen as a challenge, because the rise in living costs is particularly noticeable in old houses.
The decrease in the prices of studio apartments could benefit financially healthy people who are considering buying their first smaller apartment, he estimates.
“The prices of new apartments have risen due to the rise in construction costs, and construction is becoming more difficult in the current market situation,” commented Kyhälä.
Aleksi Teivainen – HT