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Market outlook

Market outlook for 2017 published in the Interim Report January-September 2017

Finland

Consumer demand is estimated to remain on a good level. The large investors’ activity is estimated to remain on a lower level compared to the previous years. The importance of location and price level remains significant.

Residential price polarization is estimated to continue between growth centres and the rest of Finland. Access to mortgage financing is estimated to remain good. The increased supply of apartments is estimated to prevent the market overheating.

The tenants’ interest for business premises is estimated to pick up slightly in growth centres. The real estate investors’ activity is expected to remain on a good level with focus on prime locations in the capital region especially. Business premises contracting is estimated to remain active but the average project size is estimated to decrease. New infrastructure projects are estimated to revitalise the market. 

The increased competition for skilled labour due to high construction activity is expected to continue. Construction costs are estimated to increase slightly. Construction volume growth is expected to slow down.

Bank regulation and increased capital requirements of financial institutions might have an impact on the construction and real estate development. 

 

Russia

In Russia, the low point of the economic cycle is estimated to be behind, however residential demand is anticipated to improve only slowly and the price levels to remain stable on a low level. The moderate recovery of the economy is estimated to have a moderate, positive impact on the residential market. The weakening of ruble and expectations of decrease of interest rate are expected to influence consumer behaviour.

Residential demand is expected to focus on affordable apartments also in Russia. Construction cost inflation is estimated to remain moderate.

THE CEE countries

Residential demand is expected to remain on a good level. Residential prices are estimated to increase slightly. The price level of plots has increased and the competition for plots is expected to remain on a high level. Good access to financing and low interest rates are estimated to support the residential demand going forward as well. Shortage of resources is estimated to increase construction cost inflation.

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