The number of offers being made for properties is declining and demand is dropping, Friday's "Aktuaalne kaamera" reported.

The time when there were three buyers interested in every available apartment is over, Pindi Kinnisvara's sales partner Peep Sooman told AK.

"Today maybe there is one," he said. "The time of sellers' dictating [the rules] is over and demand is starting to fall far short of supply."

Many people are concerned about high energy prices, rapid inflation, interest rate hikes and are generally uncertain about the future.

Consumer confidence is also far lower now than it was during the economic crisis in 2008, Sooman said.

Back then it was -29, but now it has plummeted to -45, he said citing research by the Institute of Economic Studies.

Banks have given loans on the assumption a person will be able to make repayments even if interest rates rise.

"We have told all borrowers that the first thing to do if they are having difficulty paying is to contact the bank so that possible solutions or relief can be worked out," said Anne Pärgma, head of housing loans at Swedbank.

No one knows how much property prices may fall. But this is not necessarily bad.

Ain Kivisaar, CEO of Metro Capital, said the situation is "perfectly normal" and people should not believe this situation will be as bad as the financial crash.

"When property prices fell by 30, 40, in some cases 50 percent. Something like that is certainly not on the cards," he said.

Peep Sooman also saw positive points.

"After all, society's overall purchasing power in the property market is growing. If real estate becomes more affordable, this will be good news for the people of Estonia," he said.

--

Follow ERR News on Facebook and Twitter and never miss an update!