No immediate solution for Tallinn housing shortages on the horizon

Apartment block in Estonia.
Apartment block in Estonia. Source: Siim Lõvi /ERR

Housing shortages in the capital are affecting both people who have fled the war in Ukraine and are seeking accommodation and locals alike, ETV news show 'Aktuaalne kaamera' (AK) reported Monday evening.

Neither Tallinn city government, nor the state nor the private sector say they can foresee any quick solutions either, with new builds held up by supply chain difficulties.

Julia, who fled Kharkiv, Ukraine, with her son, told AK that while she has found work in Tallinn, finding an apartment was less straightforward.

She said: "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."

Scarcity and rising rents are causing headaches for others looking for apartments as well, while some ongoing projects have been put on hold due to supply chain issues, while initiating new projects is similarly difficult.

Deputy Mayor of Tallinn Andrei Novikov told AK that: "There is a cycle, from the decision to build something, until the keys get handed over, which is so lengthy that the current problem can only be solved by buying from the market."

"However, this will again create inflationary pressures and even higher prices by the end of the day. is the opposite effect, "said Andrei Novikov, Deputy Mayor of Tallinn.

The Ministry of Economic Affairs sees continued investment in the construction of rental housing as one possible solution, but which needs a political decision. So far, the construction of 21 rental houses in 19 municipalities across Estonia has been initiated.

Ivo Jaanisoo, head of communications at the ministry, said such past investment: "It was a success story for many local governments, it is still a success story. And of course such an example could be repeated. But it ultimately depends on political decisions."

In Tallinn, up to 140 rental apartments may be constructed by the city, primarily in the Mustamäe and Põhja-Tallinn districts, but no decision has been made yet, deputy mayor Novikov added, not least because the private sector is currently not putting up new builds either.


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Editor: Andrew Whyte

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