Country Article / Postcards

Three Old Town Deals in Europe

Date: 10/23/2005

Founded by the Danes, Tallinn's Old Town (Vanalinn) is absolutely exquisite--a walled settlement with medieval fortifications punctuated by russet-capped gate towers.

Traveling here during fall is the best way to explore, even if rain showers are more common. Around Tall Hermann Tower, the Danish King's Garden, and Toompea Hill, trees are ablaze with gold and scarlet. Inside the walls, the cobbled streets lined with medieval houses are like a stage-set version of a Hanseatic merchant town. And with few tourists around, it's easy to get a table in a cozy cellar restaurant.

Real estate in the Old Town is so popular with foreigners that most locals have been priced out of the market. In 2004, real estate prices here increased 30%...and in the last six months they've gone up another 15%.

A contributing factor to these price increases--like Dubrovnik's Old Town in Croatia--is the limited inventory within the old walls. Prices are still affordable if you're not on an Estonian salary. Estonia is in the EU and plans to adopt the euro in 2007, but right now, figure 35,000 to 40,000 kroons per square meter ($251 to $285 per square foot)...roughly 20% less than equivalent properties in Riga, capital of neighboring Latvia.

Drawbacks of houses in Tallinn's Old Town include: badly-lit buildings, limited parking, and few "real" shops--amber knick-knacks and woolen sweaters, yes; groceries, no.

My three favorite property picks (two from the Old Town, one from beyond):

1. In a building dating back to 1532, a restored 1,500-square-foot duplex apartment has exposed wooden beams, stone walls, and a parking place (a rare find in the Old town). Price: 4.3 million kroon ($330,000).

2. In a 19th-century building, an 890-square-foot apartment has views over the Old Town's rooftops to the Gulf of Finland (some of the best views in the city). Price: 3 million kroons ($230,000).

3. A medley of wooden houses, modern apartment buildings, and grand villas, Kadriorg--a mile from the Old Town--is effectively a seaside district. An esplanade (Pirita Tee) joins Kadriorg to the exclusive Pirita neighborhood with its yacht club and ruins of St. Birgitta's Convent. With the medieval backdrop of Old Tallinn slowly dwindling behind you, it makes for a great walk--especially if you're a seabird spotter. In Kadriorg, near the palace built for Russia's Czar Peter 1, is an 800-square-foot apartment with a sauna in a new building. Price: 1.95 million kroons ($150,000).

My real estate contact is Parle Sepping of Pindi Real Estate Agency, e-mail: parle.sepping@pindi.ee .

Steenie Harvey
Roving Europe Editor , International Living

P.S. The communist legacy of clunking concrete is here if you seek it--head to the outer Lasnamae suburb with its endless expanse of paneled apartment blocks. Around 40% of Tallinn's 400,000 population is Russian and many live in Lasnamae. Surprisingly, property prices here are growing as fast as in central Tallinn.