A Guide to Purchasing Property in Finland

Key Types of Property Purchases

When purchasing property in Finland, there are various ownership options, each with its own rights, obligations, and costs before and after purchase:

• Apartment Ownership (in FI: omistusasuminen): Typically, buying an apartment means acquiring shares in a housing company. These shares entitle you to occupy a specific apartment in the building. Keep in mind that costs like hot water might or might not be included in monthly fees. Usually the housing company owns the land. If the housing company does not own the land, the monthly maintenance fee is higher.
• House Ownership (in FI: omistusasuminen): Buying a house entails full responsibility for its maintenance, repairs, and any renovations. Additionally, consider factors like the land surrounding the property.
• Part Ownership (in FI: osaomistusasuminen): In this arrangement, the buyer initially pays for a percentage of the apartment (commonly 10-15%) and rents the remainder from the primary owner. Over time, buyers can purchase additional shares, eventually owning the property outright. Often the city owns the land for part-ownership apartments. So even if buying all the shares of the apartment, the monthly maintenance fee also includes land rent. The land rent makes the monthly maintenance fee a bit higher.
• Right-of-Occupancy Apartments (in FI: asumisoikeusasuminen): These provide residents with long-term housing rights, similar to ownership. Residents pay a 15% right-of-occupancy fee, followed by monthly fees. While these apartments cannot be purchased, they offer security, as the agreements cannot be terminated unilaterally by the landlord.

Purchasing Property as a Foreigner

From 2020 onward, non-EU/EEA citizens need approval from Finland’s Ministry of Defence to purchase real estate. However, this rule does not apply to apartments purchased through housing companies, as these involve buying shares rather than physical property. Non-residents are advised to work with local real estate agents familiar with the process and language requirements.

Understanding Transfer Tax

Transfer tax is an important cost to factor into your property purchase:

• 4% Tax applies to real estate (e.g., houses and land).
• 2% Tax applies to housing company shares (e.g., apartments).

For real estate purchases, the tax is payable within six months of signing the contract. For housing company shares, payment is due within two months. It’s typically the buyer's responsibility to cover transfer tax, which is calculated on the debt-free price of the property (purchase price + any outstanding housing company loans).

As of January 2024, first-time homebuyers in Finland are no longer exempt from transfer tax.

Key Housing Terms to Know

When purchasing an apartment or house in Finland, familiarize yourself with these important terms:

• Sale Price (in FI: Myyntihinta): The amount paid directly to the seller, excluding any housing company loans.
• Debt-Free Sale Price (in FI: Velaton Myyntihinta): Includes the sale price and any outstanding housing company loans, which the buyer assumes.
• Finance Fee (in FI: Rahoitusvastike): A monthly payment toward the housing company loan, applicable if the dept-free sale price is not fully paid upfront.
• Maintenance Fee (in FI: Hoitovastike): A monthly fee for building maintenance and shared services, calculated based on apartment size.
• Combined Fee (in FI: Yhtiövastike): The sum of the finance fee and maintenance fee.

When reviewing apartment sales advertisements, check for any planned renovations (pipeline renovations, facade renovations) or building loans, as these could significantly increase monthly fees.

Tax Credits and Benefits

Finland offers tax deductions on certain renovation expenses and home loan interest payments, making property ownership more affordable.

Additional Resources and Assistance

For further information or assistance with buying property in Finland, explore the following resources:

• The Finnish Consumer Authority: Information on property purchase regulations.
• Suomi.fi: Comprehensive government e-services platform.

Buying property in Finland is a structured process, offering various ownership options tailored to individual needs. Whether you’re a resident or a foreign buyer, understanding the regulations and working with experts ensures a smooth and informed purchase journey.