Housing market

The housing market has continued to pick up since last summer, and transaction volumes in Oulu and Rovaniemi are already back to normal levels. Nevertheless, there is still a lot of supply on the market, which is keeping selling times longer than normal.

Currently, homes in better-than-average condition with a good location is selling well.

“Buyers are now seeking good quality at an attractive price. This kind of phenomenon is typical in a market that is not completely normal yet,” says Nordea economist Juho Kostiainen, who wrote the review.

The biggest factor behind the housing market’s recovery has been the decline in interest rates. “However, despite the drop in interest rates, many households are still adapting their finances, which deteriorated following the rise in interest rates and inflation.” 

It is expected that the short-term reference rates will be around 2% in the summer.

Read the entire February housing market review (in Finnish)Opens new window

Housing sales will be boosted by lower interest rates and a recovery in the Finnish economy. Consumers’ disposable income and purchasing power will further improve this year, as wage rises continue to clearly outpace inflation. Unemployment is also expected to start decreasing this year.

However, the rise in home prices is still curbed by high living costs and an abundant supply of homes. The oversupply in housing is also reflected in construction starts, which are limited.

“Even though the housing market is still relatively slow, falling interest rates and improved purchasing power will help stabilise it,” Kostiainen says.

If you want to move to a bigger home, the fall in home prices may be good news for you. The prices of larger homes have dropped more in euro terms than the prices of smaller homes. This means that if you buy a bigger home, you will need less money than before to cover the price difference.

If you’re considering changing homes, note that selling times are now longer than they were a few years ago. 

Read our tips for changing homes

Home prices have fallen across the country compared to a year ago, even though the price drop levelled off in 2024. The prices of old apartments in the large cities fell by 1.3% year-on-year in October and November.

“Among the large cities, prices in Turku and Espoo did not fall anymore compared to a year before. In Vantaa, prices fell by another 3.8%,” Kostiainen says. 

“We assume that the demand for homes will start to grow in the so-called growth triangle (Greater Helsinki area, Tampere and Turku), spurred by accelerating population growth.”

The transfer of students from general housing allowance back to student housing allowance will reduce demand for studio apartments this year. As an increasing number of students move into shared homes, demand for small apartments will decline. 

Looking at Finland as a whole, home prices were still 1.6% lower in October and November than a year before.

“The places in Finland where prices have increased year-on-year are Oulu, Rovaniemi and Vaasa,” says Juho Kostiainen.

Juho Kostiainen points out that if you look at the 10-year trend in home prices, Oulu is the only place outside the growth triangle where prices have remained relatively stable. In other provincial centres, prices have trended down over the long term.