Still an opportune moment for first-time home buyers
Higher interest rates have led to a decline in property prices in Finland, which has somewhat unexpectedly opened up attractive opportunities for first-time home buyers, says Jussi Pajala, CEO of Nordea Mortgage Bank Plc.
“If you’re a first-time buyer, I would say that it is still a good time to find your dream home. Even though the exemption from asset transfer tax for first-time home buyers was discontinued at the start of the year, there are still many other incentives.”
“As a result of lower prices, first-time home buyers can still find a home for cheaper than in years. I don’t expect any major changes in the housing market in the short term,” Pajala points out.
According to Nordea’s review of the housing market, home prices are not expected to start rising until the latter half of 2024, and even then only moderately. Therefore first-time home buyers still have plenty of time to look for studios or two-room flats at lower prices than in previous years.
A typical first home is a spacious studio or two-room flat measuring about 45 square metres. These types of homes have recently been built in abundance in fast-growing cities.
Furthermore, before interest rates began to rise, a lot of small homes ended up in the hands of property investors who rented them out. According to Pajala, the increase in rates as well as in costs in general has fuelled uncertainty around property investment, making many of these flats available to first-time home buyers.