Rovaniemi, Kuopio and Oulu most lucrative Finnish cities for residential investment
The most attractive cities for residential real estate investors in Finland are Rovaniemi, Kuopio and Oulu, followed by Turku and Jyväskylä – all of which are university cities, according to a forecast published jointly by the Finnish Landlords Association and the Pellervo Economic Research Institute.
According to the forecast, the best returns on investment for rental properties in Finland are to be found in smaller university cities.
Both organisations predict that long-term rental income will remain steady for the foreseeable future, but regional differences are expected to increase, especially in the value of housing.
The high cost of real estate in Helsinki has contributed to the capital’s low ranking of ninth on the forecast’s index.
Tourism raising Rovaniemi’s popularity
Rovaniemi, in Finnish Lapland, rose four places from last year’s forecast, and is now the number one location with the best outlook for residential property investment.
“Rovaniemi’s absolute strength comes from the University of Lapland,” explained Tuomas Viljamaa, corporate relations manager at the Finnish Landlords Association, in a press release.
“Increasing tourism creates positive prospects for the regional economy. The large number of tourists has brought a lot of opportunities for short-term rentals,” the press release continued.
According to Viljamaa, rental income in Rovaniemi has been good despite fluctuations in housing prices.
Differentiation also visible in cities
Traditionally, the potential increase in the value of a dwelling has been a significant consideration when investing in housing. Nowadays however the situation is different, as the value of the investment property is expected to fall in many popular locations.
“The segregation between the housing and rental markets is also visible within cities,” explained the Finnish Landlords Association’s legal adviser Tarik Ahsanullah.
“A value increase of about four percent is predicted in the Helsinki Metropolitan Area, while the value of capital appreciation at the edges of the capital city would be less than two percent. Even on the outskirts of the Helsinki metropolitan area, value appreciation may be negative.”
A total of 24 cities were included in the forecast, which analysed factors such as rental income, value of housing and regional factors. The forecast also predicts that rents will rise at an annual rate of two percent over the next few years.
Related stories from around the North:
Canada: Housing crisis in Canada’s east-Arctic worsens as homes become too old to live in, CBC News
Finland: Report highlights Finland’s top 5 housing problems, Yle News
Russia: Abandoned Russian airbase to become wealthy residential neighborhood, Photo report by The Independent Barents Observer
Sweden: Small town hopes to reverse depopulation trend affecting rural and Northern Sweden, Radio Sweden
