Leading Finnish Real Estate Agency Sees Roughly 25% Jump in Transactions
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Loading... - Jasper Cobus
- 10 Feb 2025
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Kiinteistömaailma, the largest real estate agency chain in Finland, has reported a significant uptick in real estate transactions, suggesting that declining interest rates may be revitalizing the long-sluggish market. In January, the agency facilitated the sale of 613 properties and found new tenants for 217 properties, marking a 23% increase compared to January 2024. Notably, only four of the properties sold were newly built; the majority were older owner-occupied homes.
In January 2024, Kiinteistömaailma brokered the sales of 480 older properties and 19 new builds. Mika Laurikainen, the managing director of Kiinteistömaailma, expressed that while the company anticipated an improvement from the unusually quiet first month of the previous year, the robust growth in sales of older homes was somewhat unexpected. He noted, “The January growth, which was largely achieved with the sales of old homes, marks the continuation of a trend seen in real estate markets for the past six months.”
The real estate market is expected to continue its recovery, bolstered by disinflation and falling interest rates. The 12-month Euribor rate recently decreased from 2.44% to 2.35% within a short span, which could encourage more buyers to enter the market. However, Finnish consumers may still be hesitant due to concerns about the employment situation.
Kiinteistömaailma has projected that it will at least double its growth rate from last year, aiming for an 8% increase in 2025. Meanwhile, OP Koti, the real estate division of OP Financial Group, has forecasted that the real estate market should return to near-normal levels throughout this year, driven by lower interest rates.
In contrast, SP Koti, the real estate arm of Savings Bank Finland, anticipates a quieter start to the year, similar to last year. Jukka Rantanen, managing director of SP Koti, highlighted that the challenging labor market, rising unemployment, and the potential for strikes could create uncertainty for many households. He emphasized that the recovery of the real estate market will not gain full momentum until consumer confidence improves.
Statistics Finland’s latest consumer confidence indicator indicates that pessimism remains prevalent, with consumers planning fewer home purchases in the next 12 months than usual.
The recent surge in transactions reported by Kiinteistömaailma signals a potential turning point for the Finnish real estate market, driven by declining interest rates and a growing interest in older homes. However, broader economic concerns, including employment uncertainty and consumer confidence, may temper the pace of recovery. As the market evolves, it will be crucial to monitor these factors to gauge the sustainability of this upward trend in real estate activity.
