Expert: Tourists are back, rental apartments sold out and prices at record highs
With the recovery of tourism, the short-term apartment rental business has gained new momentum, bringing a shortage and price increase to the Tallinn rental market this summer, describes Martin Vahter, CEO of 1Partner Real Estate.
"In the first months of the pandemic, clients practically disappeared overnight for those engaged in short-term rentals, and many apartments were rented out for longer periods at relatively favorable rates to ensure some cash flow. At first, prices returned to their previous level in just a few months, but this spring the price increase has been noticeable thanks to the strong return of the short-term rental market," commented Martin Vahter, noting that a significant number of war refugees who have arrived in Estonia and are trying to find permanent housing also have an important impact on the prices of cheaper apartments.
Martin Vahter gave an example of a specific two-room apartment on the edge of the Old Town, for which 700 euros per month was being asked last autumn, but in May it was sold at a hundred fifty euros higher, or 850 euros per month. "Thanks to the recovery of tourism, the areas most suitable for short-term rentals went up in price first, primarily the Old Town and then the city center, but by now the trend has begun to extend further from the city center, for example to Kalamaja," explained Martin Vahter.
According to Statistics Estonia, in March the number of foreign tourists in Estonia was about one third below the pre-pandemic period, but the number of domestic tourists set a new record. "Looking at the current trend, it seems that businesses have very high expectations for the upcoming tourist summer," noted the 1Partner CEO.
Founded in Estonia in 2004, 1Partner is the leading real estate group in the Baltic states, with offices in Vilnius, Riga, Tallinn and Tartu. 1Partner's main services are real estate brokerage, development, valuation, management, construction and investment management.
