Construction market

Sweden

The corona pandemic and contracting business cycle that has hit the Swedish economy may reduce GNP by around six percent 2020. Lower employment in combination with uncertainty about the future may have a negative effect on housing prices. There is also a risk of declining values on the commercial real estate market and more vacancies as a result of lower consumption and an increase in working digitally. The downturn in the construction market will probably be broad this year. The continued weak business cycle in 2021 is expected to have a negative effect primarily on housing construction and building construction investments in private premises. However, public building construction can grow during 2021-2022 although this year there is a risk that planned projects will not be started due to caution on the part of public customers. Development in civil engineering investments is expected to be horizontal in 2020 and 2021. A number of projects are expected to be postponed. The government is investing more than one billion Swedish kronas in railroad and road maintenance in 2020.

Norway

The Norwegian economy has been hit hard by a decline in demand as a result of the country closing, and by the plunge in oil prices. Recovery will probably take time due to the international slowdown and the low price of oil, which has ripple effects on all Norwegian business. Housing construction is expected to contract 2020 and 2021 because households are feeling uncertain as well as rising unemployment. Even the rate of private building construction risks slowing down due to lower international demand and less activity in the oil sector. Nonetheless government finances are strong which provides opportunities to keep public sector and civil engineering construction going.

Finland

The extensive shutdown in Finland and the international lack of demand has led to an abrupt fall in the country’s economy. Household confidence has declined resulting in contracting housing investments 2020 and 2021. Finland’s export dependent industry is hit hard by the weak international demand which in turn affects industrial building construction in 2020-2021. However, the outlook for office and retail construction is brighter. The forecast for public building construction investments has paled while civil engineering investments signal an increase in 2020. Work in paving and road maintenance will increase in 2020 after several years of lower investments.

Housing

	2020	2021	2022
Sweden
Norway
Finland

Forecast for started-up housing investments, new production and renovations
Source: Navet Analystics

Other building construction

	2020	2021	2022
Sweden
Norway
Finland

Forecast for started-up other building construction investments, new production and renovations (Industry, office/retail etc. and public premises)
Source: Navet Analystics

Civil engineering

	2020	2021	2022
Sweden			–
Norway			–
Finland			–

Forecast for civil engineering investments
Source: Navet Analystics

	Worse forecast compared to the previous quarterly report
	Better forecast compared to the previous quarterly report
	Same forecast compared to the previous quarterly report