Data for the 4th quarter shows a decrease in rental rates in 23 cities. In the metropolitan area, rents decreased by 1.3% compared to the previous year, while in other regions of the country the decrease was 0.5%.
Emeli Karlsson, chief economist at the Finnish Landlords Association, noted that "rental rates are falling even in cities with a tight rental market, where demand used to exceed supply."
According to economists, the main reasons for this are a decrease in the purchasing power of tenants and a reduction in housing benefits.
Meanwhile, the change in the rent level affects new construction, restraining the growth of developer activity. Private landlords are increasingly reluctant to invest in new construction, which is reducing demand.
Karlsson noted that the talk about the impending shortage of rental housing is unfounded. Despite the reduction in rents, new rental-only projects are still appearing on the market.
"I don't see a shortage in the near future. We must allow the market to adapt naturally, without outside interference," she said.Source: Helsinki Times
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