Land restrictions eased

TALLINN - Starting from May 1, 2011, another restriction for foreigners buying land in Estonia will be lifted when foreigners will be allowed to buy land in municipalities near the Estonian border and no longer have to ask for permission from the county governor if the agricultural or forest land plot is larger than ten hectares, reports Postimees. While the restrictions will be eased, one requirement will remain that if agricultural or forested land is being purchased by a company registered in the EU, it must provide evidence that it has been involved in agriculture or forestry at least three years.

However, current restrictions will continue to apply on citizens of non-EU countries, including Russia.
Peep Sooman from Estonia-based real estate company Pindi Kinnisvara says that such restrictions on Russian citizens have not prohibited them from building large villas near the border, since they simply circumvent the rules by using a front-man, or a shell company.

Worries remain in some quarters that with the change in the ruling there will be a rush of foreigners flooding into the country to buy up available land. Sooman says, though, that “Those foreigners who were not allowed, but wanted, to buy land have already done so. May 1 will change nothing and there will be no flood of foreigners rushing to Estonia to buy our land.”
Statistically, 54,500 hectares, or 2.4 percent, of Estonian agricultural and forest land is owned by foreigners. A price comparison shows that Estonia has one of the cheapest agricultural land in the EU: while in Estonia a hectare costs on average 684 euros, the average price is 734 euros in Lithuania, 3,591 euros in Latvia, 5,979 euros in Finland and 31,290 euros in Holland.