Housing development investment support for local governments



The housing development investment support is meant to allow local governments to erect new buildings with rental units or renovating existing buildings for that purpose. The goal of granting the support is to ensure that mobile workers enjoy better access to the residential rental market and to promote investments into establishing residential space for the population.

Application round was open from 03.04 until 02.06.2023. The volume of funds for application round was EUR 5 million.


  • Contemporary living conditions
  • Improved public space

For who?


local municipality

Important conditions

  • The support will be given to local governments or units under their governance outside of Tartu and Tallinn and the local governments bordering them. Their statutory activity must be housing management in the territory of the local government unit, performing their public duties according to the administrative act or administrative agreement.
  • Support is provided for comprehensive projects for construction of new rental properties or renovation of buildings that will enter use or are already in use as rental properties. The residential units to be constructed must meet the requirements applicable to residential space established on the basis of subsection 11 (4) of the Building Code. New buildings must achieve energy performance class A while renovations must meet at least class C. The energy performance class requirement does not apply to the renovation of buildings that are under heritage protection or located in a built-up area of cultural and environmental value.
  • To order the works necessary for carrying out the project, the applicant must, in conformity with the Public Procurement Act, hold a procurement through the public procurement register. The Foundation will prepare a standard example of the public procurement terms of reference, which will be published on its website before the start of the application round.
  • Users must be guaranteed the possibility of renting residential units in the rental property on transparent, objective and non-discriminatory grounds. It is not permitted to sublet residential units.
  • The rent for units in the building to be constructed or renovated will be established by the local government unit. The rent must correspond to market price. The rent may not be lower than the rent for an equivalent apartment in the given district. Calculations may be based on the expense method. For specific socio-economic target groups, the price class may be lower than the rent for an equivalent apartment in the given district.
  • It is prohibited to sell apartment property located in the rental building within 20 years of construction in the case of a newly built a rental property, and within 15 years of the renovation in the case of a renovated rental property. It is prohibited to mortgage apartment property located in the rental building unless the mortgage is established to secure a bank loan taken for the construction or renovation of the building.

Good to know

  • The maximum sum of the support can be up to 50% of the cost. The maximum support granted in one application round is €1,000,000 per local government unit.

Application process

Submit your application, including supporting documents, via the e-grants system www.etoetus.rtk.ee. The date of submission of the application should not be earlier than the opening date of the application round. The opening and closing dates of the application round and the general conditions of the grant will be made available on the Foundation’s website and in at least one national daily newspaper at least 60 calendar days before the opening date of the application round. The application round will be open until 2 June 2023.

  • A power of attorney if the legal representative acts on authorisation
  • Proof of applicant’s self-financing capabilities
  • The applicant’s decision to construct a rental house or reconstruct an existing apartment building
  • In the case of the construction of rental housing, an extract from the land register of the ownership of the property if not available in the land register
  • In the case of the construction of the rental housing, an extract of the ownership of the property from the land register is required if it is not accessible in the land register
  • An extract of the property’s development rights from the land register if not accessible in the land register
  • Justification of the need for the project, analysis of the spatial impact of the rental building and the project’s compliance with the basic principles of the quality space published on the website of the Ministry of Culture
  • The preliminary project of the rental housing
  • Confirmation of the local government unit on the impact if the applicant is a unit under the governance of that local government unit

Contact us

Kristo Hütt

Kristo Hütt

Client Manager

kristo.hutt [at] kredex.ee