Published on and written by Cyril Jarnias
New or Old: The Real Estate Matchup in Finland
In a constantly evolving real estate market like that of Finland, the choice between purchasing a new or older property can be crucial for prospective homeowners.
This article offers a data-driven matchup detailing the pros and cons of these two options. Using recent data, we will explore market trends, energy costs, and resale values, providing an informed perspective for anyone looking to invest in Finnish real estate.
Economics, sustainability, and profitability are at the heart of this compelling debate that could influence your next buying decision.
Good to know:
The Finnish housing market has been steadily growing for several years, with notable regional differences.
Cost-Benefit Analysis of New vs. Older Homes in Finland
Newly built homes in Finland generally cost more to purchase than older ones, with a typical gap placing new builds around €3,000–€4,000/m² nationally and higher in Helsinki, while older homes vary widely by region and can be significantly cheaper in many provinces. Prices in 2024–2025 have broadly declined, with measured decreases in both older and new homes, impacting valuation projections and purchase negotiations.
Detailed Comparison of Initial Acquisition Costs
- Observed prices by region (order of magnitude, primarily older homes):
- Uusimaa (incl. Greater Helsinki): apartments ≈ €3,546/m² (older), houses ≈ €2,786/m²; new builds often exceed these levels, frequently > €4,000/m².
- Pirkanmaa (Tampere): apartments ≈ €1,802/m², houses ≈ €1,993/m²; new developments generally above €3,000/m² depending on segment.
- Finland Proper (Turku): apartments ≈ €2,650/m², houses ≈ €2,379/m²; new > older, with a premium linked to energy efficiency and recent standards.
- Lapland: apartments ≈ €2,294/m², houses ≈ €1,431/m²; new builds in resorts and urban centers command a clear premium over older stock.
- Kymi Valley (Kotka-Kouvola): apartments ≈ €1,009/m², houses ≈ €1,113/m²; new builds remain rare and more expensive, with noticeable gaps.
- Recent price trends (market indicators):
- 2024: prices of older houses -2.4% year-on-year; -1.1% in Greater Helsinki, -2.6% in the rest of the country; new houses -2.6%.
- Housing price index (YoY): -1.8% Q4 2024; -1.9% Q1 2025 (sluggish trend), useful for setting discounting and valuation assumptions.
- Other initial costs to consider:
- Ancillary purchase costs (notary, registration, agency) and possible transfer tax; the new-home premium is also explained by compliance with recent technical standards and builder warranties.
Tax Implications and Incentives
- New homes:
- Possible access to benefits linked to energy performance (eco-bonuses/energy incentives) depending on programs and local policies; these incentives contribute to the price premium and projected operating savings.
- New builds benefit from high-efficiency installations that reduce the future taxable base through lower homeowners’ association fees/consumption, improving projected net returns.
- Older homes:
- Possibility of deductions/aids related to energy renovation and bringing up to code (e.g., insulation, HVAC systems, windows, mechanical ventilation), especially relevant in cold regions.
- The tax arbitrage combines with renovation costs; in several regions with low €/m² prices, a renovated older home can offer a competitive total cost despite the absence of a “new” premium.
Upkeep and Maintenance Costs
- New:
- Lower maintenance costs in the early years due to recent materials and equipment; compliance with modern energy codes reduces heating and electricity expenses.
- Impact of new energy standards: thermal specifications and high-performance systems (heat pumps, recovery) lower usage costs, increasing net cash flow in rentals and occupant comfort.
- Older:
- Risk of higher capex (roof, plumbing, electrical, facade, elevator in condos), and higher energy costs if the building is not renovated.
- Efficiency upgrades (insulation, windows, heating) can durably reduce charges but require an initial investment; potential aids partially offset the need for equity.
Valuation Trends and Investment Horizon
- Older vs. new (recent trend in Finland):
- 2024: older houses -2.4%; new houses -2.6%, showing a simultaneous correction, with regional heterogeneity (North -5.1%, East +2.0% for older).
- Over the long term (2006–2025), the average annual growth of the housing index ≈ 1.52%, with strong cyclicity; trough -7.8% (Q3 2023), 2024–2025 environment still negative.
- Takeaway for investors:
- New homes tend to hold value better in tight markets (Helsinki, Tampere, Turku) due to demand for energy performance and low maintenance, but the purchase premium delays the breakeven point.
- Older homes in low-price regions offer higher potential current yield after targeted renovation but expose to value risk in areas with demographic decline and lower liquidity.
Summary Comparison Table
| Criteria | New | Older |
| Acquisition cost (€/m²) | Often €3,000–€4,000+ national; marked premium in Helsinki | More heterogeneous; often lower outside prime urban areas |
| Incentives/tax benefits | Eco-bonuses/energy incentives depending on programs | Aids/deductions for energy renovations and upgrades |
| Energy/utility costs | Lower thanks to standards and equipment | Higher without renovation; lower after work |
| Maintenance/Capex 5–10 years | Low initially; builder warranties | Potentially high (roof, HVAC, electrical, facade) |
| Recent valuation 2024 | -2.6% (new houses) | -2.4% (older houses) |
| Liquidity in tight markets | High (Helsinki/Tampere/Turku) | Variable; lower in peripheral areas |
| Net rental yield | Moderate, stabilized by low charges | Potentially higher after targeted renovation |
Quantified Profitability Analyses and Projections
- Market baseline assumptions 2024–2025:
- Price trend: YoY index between -1.8% and -1.9% end 2024–early 2025; caution on short-term revaluation assumptions.
- Older: house prices -2.4% in 2024; regional disparities (Greater Helsinki -1.1%, North -5.1%, East +2.0%).
- New: house prices -2.6% in 2024; pressure from construction costs and interest rates.
- Indicative cash-flow example (purchase for long-term rental):
- Helsinki (Uusimaa), new apartment 45 m² at €4,800/m² ⇒ price €216,000; low charges/energy ⇒ improved net after charges but lower gross yield; positive sensitivity to central rental demand.
- Tampere (Pirkanmaa), older apartment 55 m² at €1,950/m² ⇒ price ≈ €107,000; budget €800–€1,200/m² for targeted energy renovation; potential for higher net yield if located near services/jobs.
- 5–10 year projection (cautious scenario):
- Average appreciation aligned with long-term average ~1–2%/year after rate normalization; expected better performance in employment hubs (Helsinki, Tampere, Turku).
- New-home premium partially captured via operating savings and rental appeal; renovated older homes capture some “green” revaluation if work meets demanded energy standards.
Operational Checklists
- For new builds
- Check the energy class, heating/cooling systems, and the developer’s decennial warranties.
- Simulate the cost difference vs. local older stock to estimate cash-flow differential.
- For older homes
- Technical audit: roof, insulation, windows, ventilation, electrical, moisture; plan a multi-year renovation schedule.
- Identify locally available energy renovation aids and their disbursement timeline to optimize IRR.
– New is more expensive upfront but reduces charges and capex, improving net return predictability, especially in dynamic cities.
– Older homes offer lower entry prices and potentially higher yields after renovation, but with higher technical and liquidity risks depending on the region.
– 2024–2025 data suggest a flat to declining market phase; adopt conservative assumptions and favor high-demand locations for value resilience.
Good to know:
In Finland, buying a new home involves higher initial costs, especially in Helsinki where recent apartments often reach €7,500/m², compared to €4,000/m² for older ones. Tax-wise, new constructions benefit from eco-bonuses up to €6,000 for their energy efficiency, while renovating an older home can offer tax deductions of around 30% on expenses incurred. Maintenance costs are lower for new builds due to better energy standards. In terms of profitability, new homes show more stable valuation, but older homes strategically renovated can offer attractive rental yields. Forecasts indicate an average increase of 3% per year for new homes in urban areas and a possible 5% increase for well-located older homes by 2030, maximizing investment optimization depending on property type and location.
Advantages of New Homes in Finland
New buildings in Finland offer substantial energy savings thanks to recent construction standards focused on high energy performance, supported by European funding and criteria that promote low-consumption, low-emission housing. In parallel, the rapid rise of geothermal solutions and heat pumps in district and residential heating reinforces these gains, reducing reliance on fossil fuels and stabilizing long-term energy costs.
- Key energy-saving levers in new builds in Finland
- High-performance envelope: reinforced insulation, airtightness continuity, double/triple glazing to minimize heat loss in cold climates.
- Double-flow ventilation with heat recovery (MVHR): improves indoor air quality while recovering a significant portion of exhaust heat.
- High-efficiency heating: air-to-water and geothermal heat pumps, supported by a very dynamic national market and deep wells from 500 to 3000+ m.
- Integration of renewables: solar panels adapted to Nordic conditions and seasonal thermal storage serving district heating networks.
- Incentive context: EIB criteria for very efficient new buildings and dedicated financing for low-consumption residential programs.
New homes benefit from robust protection via long-term warranties against construction defects, reducing the technical risk borne by the buyer compared to older homes and securing the use value during the first years of operation.
- Modern technologies and equipment enhancing comfort and safety
- Air quality and thermal comfort: MVHR, CO2 sensors, low-emissivity glazing, room-by-room regulation.
- Safety and resilience: fire and water leak detection as standard, materials compliant with latest standards, design favoring durability in harsh climates.
- Smart building: remote monitoring, individual energy metering, heat pump control and tariff optimization via home automation.
- Attractiveness for investors
- Low initial maintenance needs: new structures and equipment, builder warranties, and performance level limiting immediate upgrade work.
- Access to green financing: projects aligned with high efficiency standards are eligible for climate loans, improving cost of capital and resale liquidity.
- Reduced energy risk: lower exposure to energy price shocks thanks to high-efficiency systems and local renewable energy integration.
Long-Term Cost Comparison Table (New vs. Older, Observed Trends in Finland)
| Cost Item | New (recent standards, HP/RE) | Older (pre-modernization) |
| Energy bill | Low and more stable, thanks to envelope + HP/geo + heat recovery | Higher and volatile, dependent on obsolete systems and thermal losses |
| Technical maintenance 10-15 years | Low to moderate; predictable maintenance cycles, initial warranties | High: early replacement of boilers, ventilation, joinery, upgrades |
| Upgrades/climate adaptation | Already compliant, deferred costs | Heavy investments required (insulation, MVHR, HP), significant CAPEX |
| Technical risk | Partly covered by warranties and recent quality control | Increased risk of hidden defects, structural degradation |
Recent Data and Studies
– The European Investment Bank has financed 19 highly efficient residential projects in Finland (700+ apartments), attesting to the maturity and demand for high-performance new builds and their contribution to net-zero and REPowerEU goals.
– The Finnish market for deep geothermal and thermal storage is growing rapidly, with wells up to 1,600 m intended to heat up to 700 homes per site, sustainably supporting low heat costs in new connected developments.
- Value appreciation and market signals
– Testimonials from experts and institutions: green financing flows dedicated to high-performance new builds, demand for energy-efficient apartments in Helsinki, Tampere, and Turku, and decarbonization policies reinforce the valuation premium of new over older energy-intensive homes.
– The Finnish strategy favors the cost-effectiveness criterion in the transition, which benefits energy-optimized new assets and supports their liquidity and appeal for households and investors alike.
Methodological Note and Limitations
– The cost trends presented draw on a convergence of institutional sources (EIB financing), industry analyses, and technical characteristics required by the Finnish context; local differences may exist depending on the city, heating method (district vs. individual), and building type.
High-performance new programs in Finland combine energy savings, warranties, and modern equipment, reducing operating costs, improving comfort, and supporting better valuation and resale liquidity—assets particularly sought after by investors.
Good to know:
In Finland, new real estate offers many advantages, particularly in terms of energy efficiency thanks to modern building standards, allowing substantial savings on energy bills. The decennial warranty protects owners against various construction defects, highlighting increased security over older homes. Moreover, new constructions are equipped with advanced technologies like smart heating systems, enhancing resident comfort and safety. New real estate also appeals to investors, as it requires little initial maintenance, translating into reduced long-term upkeep costs, as confirmed by recent comparative studies. Finally, according to experts, the value of new properties tends to appreciate more on the Finnish market, thus offering an attractive outlook for buyers.
Builder Warranties: An Advantage for New Home Purchases
Builder warranties in new real estate in Finland generally offer more structured and longer coverage than the protections available when purchasing an older home, making them a key lever of security and peace of mind for the buyer.
Types of Warranties in New Real Estate (Off-plan/New)
- Completion guarantee (extrinsic): protects against the risk of non-completion if the developer defaults; completion financing is guaranteed by a bank or insurer.
- Perfect completion guarantee (12 months): covers all defects reported at delivery or within one year of handover.
- Two-year / proper functioning guarantee (2 years): covers separable equipment items (faucets, shutters, radiators, doors, etc.).
- Decennial guarantee (10 years): covers damages compromising the solidity, waterproofing, insulation, or use of the structure (foundations, walls, roof).
- Frequent supplementary warranties: acoustic compliance/noise regulations and structural damage insurance (DO) taken out by the developer to accelerate compensation for decennial/biennial disorders.
Comparison with Older Homes
- Older home: no completion guarantee, no standard builder warranty; protection relies mainly on prior inspection, condition reports, diagnostics, and very limited commercial warranties.
- New home: chain of legal and insurance warranties spanning 1 to 10 years, securing delivery and the structural/functional performance of the home.
| Key Aspect | New Home | Older Home |
|---|---|---|
| Risk of non-completion | Covered (extrinsic completion guarantee) | Not applicable (existing property) |
| Initial defects | Perfect completion (1 year) | Not standardized |
| Equipment | Biennial (2 years) | Not standardized |
| Structure/soundness | Decennial (10 years) | Not standardized; repairs at buyer’s expense |
| Dedicated insurance | DO (structural damage) available | No, unless specific policies |
Financial and Psychological Benefits for the Buyer
- Reduced risk of cost overruns: repairs covered for 1–10 years, limiting unexpected outlays.
- Secured delivery: the completion guarantee protects capital in case of developer default.
- Asset valuation and resale: a property still under warranty is more attractive and reassures the next buyer.
- Peace of mind: clarity of recourse, coverage timeline, and developer obligations, reducing stress related to defects and delays.
Statistics and Impact on Purchase Decisions in Finland
New home purchases are heavily influenced by the presence of a completion guarantee and a decennial warranty, perceived as major securities in choosing a new development over an older property.
Developers emphasize structural damage insurance (DO) and the 1–2–10 year warranty chain as a decisive argument in purchase journeys, steering a substantial share of buyers toward new builds in recent programs.
Recent Examples of Companies Offering These Warranties
- Bouygues Immobilier: extrinsic completion guarantee, decennial 10 years, defect reporting procedures; warranties integrated into the reservation contract and final deed.
- Icade: perfect completion (12 months), biennial (2 years), decennial (10 years), acoustic insulation guarantee; systematic subscription to DO insurance on its programs.
- Developers offering extrinsic guarantee: highlighting a third-party bank/insurer guarantor to secure project completion in off-plan sales (VEFA).
Evolution of Warranty Practices on the Finnish Market (Recent Years)
- Widespread adoption of extrinsic guarantees over less protective “intrinsic” schemes, strengthening buyer confidence.
- Standardization of communication around 1–2–10 year timelines and DO, with better post-delivery support (snag list resolution, defect reporting processes).
- Emphasis on performance (acoustic/energy) with explicit inclusion of warranties related to regulatory compliance, reflecting rising buyer quality expectations.
Points of Caution and Best Practices for Buyers
- Require written proof of the extrinsic completion guarantee and the guarantor’s identity.
- Check defect reporting procedures and response times during the perfect completion period.
- Confirm the scope of the decennial warranty (soundness, waterproofing, usability) and the developer’s DO insurance.
- Favor developers offering a complete warranty chain and transparent post-delivery processes.
Good to know:
In Finland, purchasing a new home often comes with builder warranties, a significant advantage over buying an older property. These typical warranties include decennial coverage for structural defects and a two-year guarantee for finishes, providing significant protection against possible defects. This security is attractive to buyers, reducing potential financial worries related to future repairs. In comparison, older homes generally do not offer such direct warranties, limiting buyer protection who often must rely on additional insurance. According to a recent study, about 65% of buyers in Finland consider the builder warranty a key factor in their purchase decision. Developers like YIT and SRV systematically include these warranties in their offerings, reinforcing consumer confidence. These practices have particularly developed in recent years, in response to growing demand for transparency and security from buyers.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
