Buying Properties in Estonia: Apartment Associations (HOA) Due-Diligence Guide

John Philips
3 days ago
3 min read

Why HOAs Matter When Buying Properties in Estonia

In multi-unit buildings, the apartment association (korteriühistu) owns and manages common areas, collects fees, and enforces house rules. A healthy HOA can add value; a mismanaged one can mean surprise levies and disputes.

1) What Your Monthly “HOA Fee” Really Covers

Cost Bucket	Typical Items	Buyer Tip
Utilities (common)	Stairwell electricity, lift service, heating of common areas	Ask for last 12-month utility statements.
Maintenance	Cleaning, snow removal, landscaping, minor repairs	Check frequency—cheap isn’t always better.
Reserve Fund	Future big-ticket works: roof, façade, pipes	Healthy target: ≥ 0.3–0.5 €/m²/mo saved.
Admin	Manager salary, accounting, insurance	Verify manager is licensed and insured.

Benchmark (2025): Tallinn apartments often pay 1.2–2.0 €/m²/month; premium new builds slightly higher due to lift and amenities.

2) Documents to Request Before You Sign

Last two annual reports + current budget
Reserve-fund balance and capital plan (roof, façade, lift, pipes)
Arrears report (unpaid owner fees)
House rules (kodukord): quiet hours, pets, balcony use, smoking
Minutes of last 2–3 meetings—look for planned special levies
Insurance policy for the building (sum insured, excesses)

3) Governance & Voting Essentials

Topic	Rule of Thumb
Meeting quorum	≥ 50 % of voting shares present or represented
Ordinary decisions	Simple majority of votes cast
Big works / loans	Often 2/3 majority required
Representation	Votes usually by shares (m²), not headcount

Proxies are common—get the template if you can’t attend.

4) Red Flags—and How to Respond

Red Flag	Why It’s Risky	Buyer Move
Arrears > 10 % of annual budget	Cash-flow stress; service cuts likely	Ask for seller credit or price reduction
No reserve fund / negative balance	Special levy almost certain	Budget +0.5–1.0 €/m²/mo for 12–24 months
Pending lawsuits	Insurance complications	Require disclosure + indemnity in contract
Uninsured or low sum insured	Under-rebuild	Demand policy upgrade before closing

5) Short-Lets, Pets, EV Chargers: By-Law Hotspots

Short-term rentals: Many HOAs restrict stays < 30 days; require written consent.
Pets: Usually allowed; nuisance rules apply.
EV chargers: Owner-paid installation; HOA approves load & cable routes.
Balcony glazing & AC units: May require uniform design; some façades ban them.

6) Special Levies & Loans—What They Mean for You

For major renovations (roof, façade, pipe stacks), HOAs either:

Raise a special levy for a period (e.g., +0.8 €/m² for 24 months), or
Take an HOA loan (10–15 years) repaid via monthly fees.

Ask for loan terms, security (usually assignment of fees), and whether fees are indexed.

7) Insurance & Liability Basics

Building must carry property insurance; many also add board liability.
Individual owners should keep contents and liability policies.
Claims often split by cause—e.g., pipe burst in your unit → your policy first, then HOA’s for common damage.