Market development in January-September 2017
Housing Finland and CEE
Consumer confidence picked up in Finland during the review period, which was also seen as good consumer demand. However, there were no signs of overheating. Supply has increased to a high level during the year. In addition to the demand focusing on affordable apartments in growth centres, the demand for bigger apartments continued to improve. Investors were more selective in their investments and the demand focused on the capital region, Turku and Tampere.
In the CEE countries, consumer confidence was on a good level especially in the Czech Republic and has improved from the beginning of the year clearly especially in Latvia. Residential demand was mainly brisk in the CEE countries.
Residential prices of new apartments increased slightly on average and the shortage of resources in the CEE countries caused cost pressure especially in the Czech Republic and Slovakia.
Mortgage interest rates were on a low level in all operating countries and the availability of financing was good. In Finland, new drawdowns of mortgages remained approximately stable year-on-year during the review period.
Russian consumers were cautious in their purchasing decisions in spite of the slight improvement of the economy. During the review period, the decline in consumers’ purchasing power seems to have stopped and the purchasing power to have settled on the low level.
Residential demand started to improve during the review period in the Moscow region and remained weak in other cities. The Russian Central Bank continued to decrease the key rate during the third quarter and indicated the series of cuts to continue over the coming quarters and this was partly reflected in the residential demand. Residential prices remained stable on average and supply still on a high level. The mortgage interest rates for new apartments continued to decrease below 10% during the quarter.
Business Premises and Infrastructure
Investors’ interest towards projects in prime growth centres was on a good level in the Finnish business premises market. In Finland, the good overall market sentiment supported private investments. The tender market and infrastructure market were active especially in the capital region and growth centres.
In the Baltic countries and Slovakia, investor demand for business premises was good and rental levels have remained stable. Tender market has remained stable in the Baltic countries.