Rent prices rise by up to 15% in one month as housing shortage and Ukrainian refugees add pressure to market
Text Mark Taylor Photo Jacques Bopp / Unsplash
Rent prices in Estonia’s second city Tartu have risen by 15% in the past month. This is a trend seen elsewhere in Estonia due to a housing shortage caused by a low number of new builds because of supply issues and price rises in the construction industry. The large number of refugees from Ukraine is also adding pressure on an already limited market.
In the past month, rent prices in Tartu have risen by an astonishing 15 per cent, and are likely to continue to rise as the summer season progresses, and we move into July and August, when students seek accommodation for the next academic year. This spike in prices is also affecting towns elsewhere in Tartu county, such as Elva and Nõo, which have also seen a sharp rise in rental prices.
“If you compare with a few years ago, when a two-room apartment in a renovated apartment building was in the order of €250, then today you can safely say it will be €350. If we talk about new houses, the prices of which are also starting to quietly rise, then it will be over €400 for two-room rental apartments,” explained Janar Saviir, who is a broker in Elva and Nõo.
There is a similar problem in Tallinn, where both locals and Ukrainian refugees are finding it hard to find rental accommodation. A shortage of new housing, as a result of supply issues and price rises in the construction industry, along with large numbers of refugees, is putting significant pressure on the rental market. As a result, prices in the capital are also rising.
“It is very difficult to find an apartment right now. There are properties available on the market, but it is impossible to rent them, because there is a set price, for example, €450 or €300. However, for Ukrainians, these rents cannot be met, as you additionally have to pay for two months and brokerage fees. Where we did have any funds, these went on food costs. But we certainly don’t have upwards of €1,000 for living space.” Julia, a Ukrainian refugee from Kharkiv explained.
Currently, 21 public owned rental properties are under construction by 19 municipalities across Estonia, with more in approval and planning processes. However, these as well as other new builds, are unlikely to ease this pressure anytime soon.