I’m looking for an apartment for investment in Rovaniemi (we live here, I’m European, my spouse is suomalainen). From my understanding, the smaller apartments in the city center are better for investments, as their monthly payments are relatively lower (Hoitovastike and Pääomavastike), and the smaller apartments are easier to rent out to students or a couple or ppl who live alone. is this correct? for example, [this](https://www.yit.fi/en/homes/apartments-for-sale/rovaniemi/kiela/rovaniemen-lumileinikki/1-suuc3t) apartment that is for sale now.
​
few other inquiries that I will be happy to get some help with:
1. is Rovaniemi city center a good place for real estate investments? I’m looking for a property up to 180K€ (preferably lower). are the price of the properties in the city center going up “slowly but surely”?
2. how can I track the past performance of real estate properties in Finland? especially in city centers. for example, how much a particular flat in Rovaniemi used to cost in the 90s, 00s, 10s and now, etc.
3. what does the Hoitovastike include exactly? in other words, what do I pay for? (I understood it’s for the heating, and snow cleaning)
4. how does the rental market work? are there limitations on the rent amount, or is it an open free market that is only decided by supply and demand? What is the usual raise in rent price over let’s say 5 years period?
7 comments
Don’t.
Don’t do it
Good idea. I have made so much money by doing this!
You seem to have a mixup in terms. ”Real estate” means land ownership, sometimes with a house. Apartments are not real estate.
This being said, apartments in central locations have been a good investment basically always, maybe excluding times like late 80’s when there was a huge bubble. People need to live somewhere, so an apartment in a house with a good maintenance is reasonable an investment.
But I would not think it as an investment if you are planning to live in it, it is more like a method for saving a bit. So buy an apartment that suits your needs and your income.
By no means an extert, but my understanding is that the north is not the first place to looking for investment real estate.
Unemployment rates are higher in the north, less population, less jobs. And with the current global situation, it’s only gonna get worse.
—————–
invest in bunkers s/
Seems like everybody is having some issues in their life when they got nothing better to comment around here than they they have. Let me.
0. A two room apartment is good for one tenant or a couple. You can check the rent prices around the area online.
1. Nobody knows. Real estate/apartments in the past have the history of keeping their value, if they are located in cities that is.
2. There are no good tools for this for the general public. Agents know and see price history in the area, you can inquire from them.
3. It includes everything related to the maintenance of the building. It also includes maintenance of your windows and plumbing.
4. Open market with supply/demand. An ok amount to rise your rent is about 2%/year or for a good reason, for example a renovation. But rising it always risks losing the tenant. They can terminate the contract always on one month notice. The termination rights for the landlord is difficult.
Seems like you are looking at a long term investment.
If you are relatively young (below 40) and wont be needing that money for atleast 10 years, i would warmly suggest building a portfolio of stock funds instead. Be sure to throw a fair percentage (30% ish) into high risk. You will most likely get a much higher return of investment that way than from apartment shares (you buy the shares to the housing company ltd and get user rights to an apatrment, you dont buy the apartment per se).
Also stock funds will leave you with MUCH less headaches.
In the future when you are ready to settle down, you can use those stock funds as pawn to a mortgage isntead for a downpayment.
Remember, with a 25 year loan, all it takes is a 4% interes rate to make you pay the same amount of money monthly on interest as you are paying off the loan, so in total you will pay 180k interest on an 180k loan. The loans today would give you a rate of about 1.7% without any securities.
Ask for a meeting with your bank and look at options, personally i would absolutley go the more liquid route in this undrable market.