Just back from holiday in Estonia, a country which I love and have been keeping going back to since I first where there about 8 years ago.

Over the last few visits I've seen exactly the same happen there are here: high rise tiny flats with poor build quality being thrown up and sold for silly money, mainly to British wannabee BTLers ( a lot of the adverts were in English only).

I remember one program (I only watched it because it was about Estonia, but I think it was called something like "A Property in The Sun") where one of the self confessed expert was getting ratty with a couple from London that didn't take her advice to buy a small flat in a provincial city that cost about 24 times a typical Estonian wage.

My Estonian isn't good, but I can make out enough of an article in the newpaper to see that it is saying that the price of new build flats in Tallinn city centre (which would be the most desirable ones) has fallen by 52% over the last year.

An Aussie living there was saying that banks there won't admit it, but they won't give anyone a mortgage at all for love or money; standard mo is to keep changing the goalposts with continual requests for information / use of the bank's other products until the person gives up.

Developments outside Tallinn tend to be small, 1 or 2 houses being built at a time. However the countryside seems to contain rather a lot of developments that have just been abandoned, or where the first 6 or 8 houses have been built previously but the last ones have been abandoned.

In addition the government admits that inflation is over 10%, and that felt about right looking at the price of things in the shops. (However what I noticed was that I'd say prices have gone up more here.)

52% is a lot steeper than I had heard. If you have any links to show that there has been this sort of magnitude of drop then please provide them.

Visited Tallin twice in 2006 and didn’t invest in city centre apartments as I felt that only a small proportion of the local population could afford the prices being asked. Nor did I like the fact that lots of them were springing up and that sqm price was similar to that in the Old Town. (Old town properties would always be in limited supply too, unlike the new build.)

I could see that areas like Balti Jam were central and very popular with locals. I didn’t invest there as maintenance / management costs would have been high when expressed as a proportion of price of apartment (potentially wiping out rent.)

I did invest indirectly in Estonia through a fund where like minded people provide finance for a team with strong track record of successful developments in the Baltics. They seek to add value to land (planning permissions etc) then either sell on to another developer or manage the development themselves. (For the latter the end product is aimed at local businesses / individuals. It isn’t aimed at the F2L crowd.)