Published: 29/07/25 | 23:49
While Finland’s overall housing market remains stagnant the city of Kajaani stands out as a surprising exception. In June the prices of older condominium apartments in Kajaani rose by an impressive 14.8% compared to the same month last year which defies the nationwide downward trend.
This rise contrasts with the general market situation as Statistics Finland reports that overall prices for old housing units in housing associations dropped by 1.3% year-on-year. In Finland’s six largest cities that are Helsinki, Espoo, Tampere, Vantaa, Oulu and Turku the decline was even steeper with a combined decrease of 2%. In contrast prices outside these major urban centers dipped only slightly, falling by just 0.1% in June.
Despite falling prices across much of the country, housing sales activity picked up notably in June. Sales of existing apartments and terraced houses via real estate agents rose by nearly one-third compared to the previous year.
Kajaani real estate entrepreneur Isa Kihlström from Kiinteistömaailma (Real Estate World) admitted he didn’t expect such a strong uptick in local housing prices.
“The common assumption might have been that prices are flat or falling,” Kihlström remarked.
Kihlström attributes Kajaani’s distinct market performance to minimal new construction in recent years. At present only one major apartment project is underway following a period with very little building activity.
Although much of Kajaani’s housing stock is older, many buildings have undergone renovations over time. With interest rates stabilizing, housing cooperatives have become more confident in taking loans for upgrades further enhancing property values.
“Right now, older, well-maintained buildings and apartments are performing well,” Kihlström explained.
He also noted that the local housing market has grown more active since last year. According to him the broader effects of this price growth are likely to become more evident going forward.
Similar to Kajaani Kokkola also saw notable price gains with old condo prices rising by 14.3% compared to the previous year. Pori followed with a 6.2% increase. However, these cities are outliers in a market that continues to trend downward on a national scale.
Juhana Brotherus, Chief Economist at the Federation of Finnish Enterprises, predicts that overall housing prices in Finland will continue to decline throughout the year, revising earlier more optimistic projections.
“Even with a slow recovery underway sales are still below normal levels which limits price growth,” Brotherus stated.
He believes that a significant increase in sales activity would be required to spark real competition among buyers which is something that could in turn drive up prices.
Brotherus pointed to persistently high interest rates as a key factor restraining the market. While mortgage rates have stabilized near two percent he argues that this level remains too high given the current state of the Finnish economy.
