Statistics of purchase and sale of real estate in Estonia in June 2013 caused considerable surprise. About half of real estate transactions in Narva were held by foreigners, and the average value of transactions was by 45% above the national average.
In June, 32 transactions were committed (in May - 60). Kristjan Gross of Domus Kinnisvara is sure that decline is due to the unreasonably inflated prices. In Narva more expensive property is sold, usually by the Russians, and this leads to higher prices.
Elena Sapezhko, the head of the eastern region of Domus Kinnisvara, believes that prices in the region may be influenced by high wages in Finland. In addition, the real estate market is affected by large construction projects that are carried out in the region as the people involved in the construction need somewhere to live. Increased demand has led to an increase in rents, which also affected the real estate market.
Elena Sapezhko does not agree with the opinion that the Russians are buying property in Narva, in order to obtain a Schengen visa. These customers usually buy low-cost apartments in the region of Ida-Viru and apartments in Tallinn and Pärnu.
Broker Hannes Hallik argues that in the region of Ida-Viru Russians occupy only 8-10% of the housing market. Last but not least, this is because the Ministry of Defence of Estonia has banned foreigners from buying houses and land in the region. The purchase of apartments in cities is only allowed.
Hallik believes that many Russians who have bought a house in Estonia, now sell it without seeing a significant rise in price of real estate in the country.