AGING POPULATION AND UNCERTAINTY INFLUENCE RENOVATION DECISIONS OF HOUSING COOPERATIVES IN SOUTHEAST ESTONIA.
Renovation Pace of Southeast Estonian Housing Cooperatives Varies by Region; Valga Cautious Due to Aging Population.
The renovation activity of apartment associations in Southeast Estonian municipalities shows significant regional differences. While, for example, many apartment buildings have already been renovated in Põlva and numerous renovation works are currently underway in Võru, the pace is slower in Valga.
The total amount allocated for the apartment building renovation support round, which opened last October, is 170 million euros, with seven million euros earmarked for Valga County. As of yesterday, 20 applications had been submitted from Valga County, but none from the town of Valga itself.
According to Aet Arula-Piir, a housing cooperative advisor at the Valga County Development Agency, there is noticeable application activity in Tõrva and Otepää, while Valga is still gathering momentum. She explained that, naturally, people want beautiful and functional homes both inside and out, but the question is whether they can afford it, which is being carefully considered. There is also a lack of technical consultants.
"The town of Valga is in a more challenging situation. There are larger apartment buildings here, but I also assume that the higher proportion of pensioners and perhaps a bit of a lack of information play a role, as we also have people who do not speak Estonian as their native language, who may not be as confident in making big decisions and taking on a relatively large loan burden with modest incomes," said Aet Arula-Piir.
Cooperatives in both Võru and Põlva counties could apply for a total of six and a half million euros in support. 14 applications were submitted from Võru County, most of them from the town of Võru. 12 applications were submitted from Põlva County, with about half from the town of Põlva. While renovated or continuously being renovated apartment buildings are prominent in the towns of Põlva and Võru, the situation is different in the more remote areas of both counties.
Ülo Needo, a consultant for apartment building support measures at the Põlva County Development Centre, pointed out several reasons for the slower pace in the county. Firstly, the population tends to be older, and there is a reluctance towards large expenditures. Secondly, there may be initiators, but their energy wanes when battling bureaucracy and opposition.
Thirdly, he mentioned that some cooperatives have already taken out loans and partially renovated their buildings independently and are therefore not interested in Kredex's full solution. Ülo Needo gave the example of Mooste village, where cooperatives have found a specific builder who has been consistently repairing roofs and insulating gable walls, financing the work themselves with loans.
Jaanus Mark, a consultant for apartment building support measures at the Võru County Development Centre, highlighted a concern regarding the fact that the value of apartment buildings in rural Southeast Estonia may be so low in the eyes of banks that it is difficult for cooperatives to obtain loans. There are further concerns as well.
"People in rural areas are more skeptical. Of course, the possibility of self-financing is also a very big concern, as it is indeed small in the countryside, or in some cases completely non-existent, so they are unable to repay the loan after renovating the building," said Jaanus Mark.
At the same time, both Mark and Ülo Needo confirmed that a kind of domino effect is in play – once one building is renovated, it inspires others in the vicinity.
Taniel Vain, Head of Apartment Association Supports at the Enterprise Estonia (EAS), noted that in addition to Valga and Põlva counties, support rounds are also open in Hiiumaa, Saaremaa, and Ida-Virumaa.
