In January, the Ministry of the Interior announced its intention to tighten up the rules and now a draft amendment to the Immovable Property Acquisition Restrictions Act has been drawn up.

The explanatory memorandum says the legislation aims to limit the ability of hostile states or persons under their control to use real estate for intelligence and influence activities or sabotage operations against Estonia, thereby strengthening national security.

The new rules will allow Estonia, for the first time, to ban citizens from countries that pose a threat to the country's national security or public order from buying property.

This would make it possible to ban Russian and Belarusian citizens without long-term residence permits, companies from those countries, and legal entities in which they are beneficial owners from acquiring immovable property.

The new rules will not be applied retroactively and do not affect individuals with long-term residence permits. This is because their background has been vetted by the state through their time living in Estonia and compliance with long-term residence permit requirements, the explanatory memorandum states.

The amendment will also harmonize restrictions so that they extend to apartment ownerships, which until now have been outside the scope of the Immovable Property Acquisition Restrictions Act.

The draft removes the possibility of circumventing restrictions via companies registered in Estonia or other European Economic Area countries by clarifying the role of the beneficial owner and requiring notaries and other transaction supervisors to identify the citizenship of beneficial owners.

The ban on acquiring immovable property would also apply to a legal entity, regardless of its location, if its beneficial owner is a natural person who is not a citizen of a European Economic Area member state or the United Kingdom.

Government can grant exceptions

The Ministry of the Interior says in the explanatory memorandum that the draft complies with the Estonian constitution.

"The planned measure constitutes a moderate and legitimate restriction serving an extremely weighty objective — the protection of Estonia's national security. Property rights are not restricted retroactively, and the ban does not deprive anyone of existing property. Any infringement of the principle of equal treatment is justified, as the distinction is based on an objective security threat, not on collective responsibility," the memorandum states.

The drafters of the law say the proposal is also in line with European Union law, which allows restrictions on the free movement of capital on grounds of public order and security.

"Individuals will still have the option to lease or rent real estate, and the government of the republic may, for reasons of national importance or on humanitarian grounds, grant permission to acquire immovable property," the memorandum states.

The restriction would affect approximately 600 transactions per year and is not expected to have a significant impact on the real estate market, the drafters say.

The draft draws on Finland, Latvia, and Lithuania's experiences, which have also tightened property acquisition rules for third-country nationals due to security concerns.

The law is planned to enter into force on January 1, 2027.

As of April 2025, there were 36,952 citizens of the Russian Federation and 896 Belarusian citizens among property owners in Estonia.

As of January 9, 2026, Estonia has 7,797 Russian citizens with temporary residence permits and 70,237 with long-term residence permits, as well as 1,476 Belarusian citizens with temporary residence permits and 1,190 with long-term residence permits.

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