Outlook for construction
Although the European economy is continuing to grow, significant financial and political uncertainty factors in several countries, both inside the Euro zone and elsewhere, are continuing to pose risks in development. The Finnish economy is seeing broad-scale recovery. Exports and industrial investments have increased, supporting the growth initiated by domestic consumption and construction. GDP is expected to grow by 2.5–3.5 per cent in 2017.
Growth in construction will continue this year almost on a par with the previous year, estimated at about 4 per cent. On the heels of economic growth, activity in new construction has been stronger than forecast, thanks to which volume growth will also be seen in 2018. (Source: Business cycle review by the Confederation of Finnish Construction Industries RT 10/2017).
Urbanisation and population shift will continue to be the general drivers of construction growth and will maintain the need for both housing and business construction in growth centres, which are SRV’s strategic focal points. According to VTT's forecast, urbanisation will continue, as Finland’s urbanisation ratio is clearly lagging behind other industrialised nations, such as Sweden. In the most optimistic forecasts it is estimated that about 620,000 people in Finland move into urban areas by 2040. (Source: VTT, Demand for new dwelling production in Finland 2015–2040, 1/2016.)
Housing, business and infrastructure construction in Finland
In general, housing sales in growth centres have remained at a good level thanks to population shift and investor sales. Housing production is still focusing on small apartments. Last year, construction was launched on a total of more than 37,000 housing units in Finland, which was significantly more than in the 26 October 2017 at 8:30 am 8 (27) Q3 previous year. The Confederation of Finnish Construction Industries forecasts start-ups for as many as about 43,000 housing units this year.
In business construction, the start-up volume (in terms of cubic metres) rose significantly in 2016 with the launch of several major projects. According to forecasts, public service construction start-ups will increase slightly this year. A significant pick-up is being seen in retail and office construction, while industrial construction is remaining almost on a par with 2016. On the whole, new business construction start-ups will increase slightly. The growth rate in renovation is forecast to decline slightly compared with the previous year, and to amount to about 1.5 per cent in 2017. The civil engineering construction are forecast to increase by about two to three per cent this year, although growth is expected to slow next year. (Source: Business cycle review by the Confederation of Finnish Construction Industries RT, 10/2017)
According to Statistics Finland, construction costs have risen slightly on September 2016. The prices of equipment and supplies in particular have risen over the past 12 months. (Source: Statistics Finland, Building Cost Index)