Kuressaare, the capital of Saaremaa island, stands out as one of the most attractive real estate markets in Estonia. With its seaside charm, high environmental quality, spa infrastructure, and growing popularity among both local and international buyers, the town is gaining recognition not only as a holiday destination but also as a smart place to invest or settle down.
Why Kuressaare is a Real Estate Hotspot
- Picturesque location on the Baltic Sea
- Established spa and wellness tourism
- Seasonal rental demand from tourists
- Lower property prices compared to Tallinn
- Clean environment and safe urban setting
Property Prices in Kuressaare (2025)
As of early 2025, the average property price in Kuressaare ranges from €1,800 to €2,300 per m², depending on the area, condition, and property type.
Average prices:
| Property Type | Average Price | Price per m² |
|---|---|---|
| 1-room apartment (city center) | €90,000 | €2,400/m² |
| 2-room apartment | €115,000 | €2,200/m² |
| 3-room apartment | €135,000 | €2,000/m² |
| Detached house in town | €200,000–300,000 | from €1,900/m² |
| Modern townhouse | from €250,000 | €2,500/m² |
| Building land (per m²) | from €35/m² | — |
Waterfront homes or properties near the spa zone are typically priced 15–30% higher than similar units located further inland.
Most Attractive Areas in Kuressaare
City Center
- Price: from €2,300/m²
- Pros: historical charm, walkability, high rental potential
- Cons: limited listings, expensive renovations in old buildings
Southern Residential Zone
- Price: €1,800–2,100/m²
- Pros: quiet, family-friendly, near schools and parks
- Cons: car often required for commuting to city center
Türi Area & Seaside Streets
- Price: €2,300–2,800/m²
- Pros: sea views, modern houses, exclusive neighborhoods
- Cons: limited supply, rental demand mainly seasonal
Eastern New Developments
- Price: €1,600–1,900/m²
- Pros: energy-efficient new buildings, playgrounds, parking
- Cons: farther from downtown, some construction sites ongoing
Rental Market Overview
Tourist rentals peak from May to September, particularly near the town center and coastline.
Average rental rates:
- 1-room apartment: €450–700/month
- 2-room apartment: €600–900/month
- Detached house near sea: €1,200–2,500/month (in season)
Short-term rental platforms like Airbnb offer a return of 5–7% annually when well-managed.
Advantages of the Kuressaare Market
- Price growth of 6–8% annually over the last 5 years
- Low crime, high quality of life
- Strong municipal support for private construction
- Reliable tourist flow from Finland, Germany, and Sweden
- Lower property taxes than in larger Estonian cities
Challenges and Limitations
- Small market with limited supply
- Seasonal fluctuations in rental demand
- Lower liquidity compared to Tallinn
- Mortgage financing for foreigners can be slow but possible
Forecast for 2025–2027
Experts anticipate continued market expansion due to:
- New investments in spa and health tourism
- Growing interest in remote seaside living
- Improved transport connections to the mainland
- Rising demand from foreign buyers
Projected price growth: 4–6% annually over the next 2–3 years.
Conclusion
Kuressaare Appeal: A Closer Look at Estonia’s Hottest Real Estate Areas shows that this seaside town offers more than just a tranquil holiday spot. It is emerging as a reliable and charming real estate market. With steady price appreciation, high rental potential, and natural beauty, Kuressaare represents a strong option for both buyers and investors looking for long-term value in Estonia.
