There are more than twice as many flats available for rent in Helsinki now than there were before the Covid pandemic, though larger landlords are not yet slashing rents.
Tenants had been expected to return to the market as Finland puts Covid restrictions behind it, but at least in the capital city region it is taking longer and longer to find people to take rental properties.
"Before, the marketing time in Helsinki was clearly shorter than in the rest of the country, but now it is longer," said Juhana Brotherus of housing lender Hypo. "There has never been this range of properties available or this much power for those looking to rent."
The biggest increase in availability has occurred in Espoo, where Brotherus said there are three times more rental properties on the market as in autumn 2019.
In Helsinki there are twice as many flats available.
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It's not that the flats aren't good enough for the tenants, according to Henrik Laakkonen from rental website Vuokraovi.com.
"Demand has not dropped, but supply has risen faster," Laakkonen explained.
If you're looking for a flat, this is good news. There's lots of choice, and you may find there are better apartments within your budget than you'd expect. The most popular flats at the moment on Vuokraovi are one-bedroom apartments, and there are more of them on the service than other kinds of flat.
Landlords are having to compete for good tenants, according to The Finnish Landlord Association.
"It is still difficult to find a tenant in the capital city region," said Sakari Rokkanen from the association. "Elsewhere in Finland there have been positive signals during summer and autumn about demand returning to the market, but that progress has been slower in the capital city region."
Supply has swelled during the pandemic as Airbnb and other short-term landlords have seen traveller numbers decimated, causing them to switch to the normal rental market instead.
According to Rokkanen, that accounts for an increase of around 1,000 properties on the market in Helsinki.
Short-term rentals represent a bigger chunk of the market in Helsinki than elsewhere. Travellers have still not returned to pre-pandemic numbers.
"The situation for the travel, restaurant and culture sectors has been weak and work has not attracted new residents to Helsinki or the Helsinki region in the same way as before," said Rokkanen.
But he said he does not believe this situation will last for long.
"Property prices give some indication that there is belief in Helsinki, although at this point neither the employment situation nor the kind of day to day life that shows the city at its best are on offer," said Rokkanen.
Brotherus agrees. In the short term property prices may have risen too much, but in the long run they might not have risen enough.
"Especially in Espoo and Vantaa there are now compact rental apartments under construction, for which there is definitely demand and a need in the long run," said Brotherus. "They won't be filled quickly, however, especially in a situation where the service and travel sectors are still facing big difficulties."
When supply outstrips demand, prices can be expected to drop. That's not yet evident in the statistics on rent levels, although there are hints that the rise in rents has stopped.
According to Statistics Finland rents rose 0.9 percent in the capital city region and around one percent in the rest of Finland, compared to a year earlier. The steepest rise was in Turku, where rents jumped 1.7 percent, and in Tampere, where they rose 1.5 percent.
Brotherus said this doesn't tell the whole truth, however.
Statistics Finland figures only include rents received by large institutional landlords, and those paid by housing benefit. Private individuals who rent from private landlords without claiming housing benefits are not visible in the data.
"Rents for both these most creditworthy tenants and for new tenants seem to have fallen, according to many indicators," said Brotherus.
On the other hand, institutional investors and larger landlords are better able to handle properties lying empty for a month or two, in order to maintain rent levels.
Rokkanen adds that the typical time to raise rents is when tenants leave, and many landlords are choosing not to increase rents as they have done when demand is strong.
TetraSys Oy.