Keen real estate watchers will have noticed the number of apartments on sale has increased significantly, Friday's "Aktuaalne kaamera" reported.

"Year-on-year, the number of rental apartments has increased by about a third, or 30 percent. There have never been so many rental apartments on the market. In the last four or five years, professional rental market providers have come to the market, perhaps this is the moment when the price is looking for the right level," said KV.ee portal manager Tarvo Teslon.

Martin Vahter, 1Partner Kinnisvara CEO, said: "There has been more supply because there has not been as much demand. The market is no longer dominated by Ukrainians. In addition, some new developments have been completed and bought for renting. Increased supply and reduced demand have left a small oversupply."

The economic downturn has also reduced demand.

Real estate analyst Risto Vähi said: "There have been redundancies from manufacturing to the IT sector, which means that internal migration within Estonia, which needs rental accommodation, has decreased, and labor migration from abroad to Estonia, which concerns Tallinn, has also decreased slightly in the IT sector. This will certainly have an impact on more expensive apartments."

Rental prices have also been affected by the changed supply-demand ratio.

Vahter said, that while higher-priced apartments were affected a year ago, the impact is now also felt in cheaper apartments.

"Landlords felt that every time a new tenant came in, they had to add 25 to 50 [euros] to the price. There is no such feeling today, and it would be better to lower it," said Vahter.

Some of the existing rental apartments have already been sold.

"What we have seen is that apartments have come up for sale that have basic furniture but have not actually been lived in. It can be seen that it is meant to be a rental apartment, but now that lending conditions have gone high and yields low, this business plan is simply not going to work," Vähi said. 

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