Experts: no property crash for Estonia

  • 2005-11-16
  • From wire reports
TALLINN - Specialists at a major real estate conference last week agreed that they did not see any chances of the "real estate bubble" bursting in the near future.
Viljar Arakas, board chairman of the Arco Vara Group, told the Baltic News Service that the company saw no signs of an impending crash.

"You shouldn't wait for a crash from the real estate market. It pays to take a wider look 's for example, at the financial market or how the economy behaves," Arakas said. To the contrary, he added that comparisons with other countries showed growth potential of the Estonian real estate market.

Demand is very high for new apartments and continues to grow. Arakas said that the Tallinn city government should tackle city development more rigorously, since they have failed to do so for some time. The current market situation and consumers' rising credit capacity have artificially increased demand, he explained.

Urmas Laur, board member of Uus Maa, a real estate company, said adopting the euro would further raise apartment prices. Competition of the suburbs' apartment market should become more critical, and prices of apartments in central Tallinn would continue to rise.

Laur also said the most important factor in the next few years would be city planning.