Estonia cuts apartment renovation grants to 20 percent

Estonia will reduce state support for apartment building renovations to 20 percent of project costs and apply the same rate nationwide, ERR reports. The government plans to provide a total of 160 million euros over the next four years to cover a funding gap between European Union budget periods.

The first application round, worth 80 million euros, is expected to open next year. Previously, grants covered 30 to 50 percent of renovation costs, with higher rates in rural areas than in Tallinn and Tartu.

Infrastructure Minister Kuldar Leis said the 20 percent rate would be budget-neutral because the money would return to the state budget through taxes. He said demand for renovation support had grown so much that the government could no longer continue offering grants of 50 percent or more.

Leis said renovation success depended largely on local initiative. Smaller cities had often performed better than larger ones, he said, pointing to Põlva, where more than 80 percent of apartment buildings have been renovated.

In Kohtla-Järve, however, no apartment building has been fully renovated, according to the city’s finance chief, Aivar Kamal. He said low apartment values made loans difficult to justify and some older residents did not see a need for renovations. Kamal said interest in applying for support would likely be close to zero at the new rate, and estimated residents would be interested if the state covered about 90 percent of costs.

Andres Jaadla, head of the Apartment Associations Union, said the government’s decision had both positive and negative aspects. He welcomed the funding but said the lower grant rate could make it harder for associations to agree on renovations. In the previous support round, held in autumn 2025, nearly 350 apartment associations did not receive funding because the money ran out.