The prolonged sluggishness in Finland’s housing market means that many buyers are in a good position to acquire properties for less than the asking price, according to the heads of two prominent property-related organisations.
Ari Pauna, chief executive of the mortgage provider Suomen Hypoteekkiyhdistys (Hypo), says that buyers in Finland’s two main growth areas, Helsinki and Tampere, now have clear opportunities for negotiating themselves a better price.
This is especially the case for two-bedroom flats and larger houses on the market for over 300,000 euros.
Bargains in Vantaa?
”If the property is economically and structurally in order, then I’d recommend putting in an offer of 5 to 10 percent below the asking price,” Pauna says. “But remember that in somewhere like Vantaa you get more square metres for your money than elsewhere in the capital.”
Pauna says that for terraced houses and flats selling at under 300,000 euros, the bargaining possibilities are much harder to generalise about. Pricing of detached houses on the market is also determined much more on a case-by-case basis, he says.
Pauna also contends that the larger the detached house, the higher the seller’s emotional investment in the property is likely to be,
“People often put lots of hard work and their soul into their own house. But you need to be able to let go of it, and therefore can’t set the asking price too high. That’s the reality of the market today and sellers are having to markedly lower their prices from the starting point,” he says.
The head of one of Finland’s largest estate agency chains agrees. Antti Asteljoki, managing director of Huoneistokeskus, says: "There’s a bigger difference between the price expectations of buyers and sellers than ever before."
Selling times increasing
The average selling time for a properties sold in July in the capital region was 61 days, an increase of five days on the previous month.
Pauna of Hypo forecasts that the housing market going into the end of the year will be smaller than it has been for the same period in the last ten years.
”The housing market is having a lacklustre 2014,” he says.
Paunu adds that the growth prospects for next year will be strongly affected by the government’s structural reforms, including wholescale changes to the pensions system which will raise employee contributions and the retirement age, impacting on economic confidence.
“All the measures show that the population is going to keep increasing in the capital and Tampere. We need new ownership and rental properties otherwise we will encounter serious structural problems in the housing market,” Paunu says.
