Selling a home for less than you paid for it does not necessarily mean that moving is a bad financial decision, according to Mika Laurikainen, CEO of Finnish real estate agency chain Kiinteistömaailma.
Many Finns bought their homes in 2020–2022, when prices were significantly higher than they are today. Laurikainen says this has created a psychological barrier that is now holding back housing transactions.
– The key question right now is how large the price gap is. There is a psychological barrier: if you paid a certain amount for your home and then sell it at a loss, it can be very difficult to see that your next home is also cheaper, Laurikainen told Verkkouutiset.
He says people looking to move into a larger home should consider the whole transaction rather than focusing solely on the loss on their current property.
Laurikainen gives the example of a seller who might take a €10,000–€20,000 loss on their existing home but could buy the next property for €20,000–€30,000 less than before.
– In that case, the overall result can be tens of thousands of euros better. It is worth going through the numbers very carefully with an estate agent, on paper or even in an Excel spreadsheet.
Family homes are selling
The overall Finnish housing market remains subdued, but Laurikainen says there are major differences between locations and types of property.
According to him, Kiinteistömaailma’s own sales figures for September were stronger than a year earlier, while activity in the first half of October has also been encouraging. However, the market-wide figures do not yet point to a broad recovery.
– Finland is not one single housing market.
Demand is strongest for family homes, Laurikainen says. In apartment buildings, the condition and finances of the housing company are particularly important, along with clear information about upcoming renovations.
He says larger two-room apartments, smaller three-room apartments and bigger family homes can sell well if they are in good condition, correctly priced and accompanied by transparent information.
Well-maintained detached, terraced and semi-detached homes built in the 2000s can also sell quickly.
– They can sell almost as soon as they come onto the market.
By contrast, properties that enter the market with an unrealistic asking price can remain unsold for a long time.
Laurikainen says an excessively high price can lead to repeated reductions, leaving the property sitting on the market and becoming less attractive to prospective buyers.
Bank processes are slowing transactions
Laurikainen says the problems facing the housing market are not limited to prices or buyer caution.
He also points to lengthy mortgage processes and difficulties surrounding collateral valuations.
– We are not currently seeing AI speed up housing transactions.
According to Laurikainen, digital property transactions had become significantly faster around a year and a half ago, but the process has since slowed again.
– It seems difficult to get transaction appointments, and mortgage decisions are taking longer. This is a challenge across Finland.
Collateral assessments can also delay or prevent transactions. Laurikainen says some homes now have very low collateral values, or effectively none at all, making financing more difficult.
He says there are signs of improving activity in the housing market, but correct pricing remains crucial. Well-maintained homes that meet buyers’ needs can still move quickly, while overpriced properties may remain on the market for a long time.