Market Trends of Scandinavia Construction Industry
Ongoing Demand For Infrastructure
The government focuses on accelerating infrastructural investment, and the readiness of existing infrastructure pipelines is critical to this acceleration. There is continued growth in Denmark's transport infrastructure sector. Road investment is slow, while railway investment growth is predicted to remain strong throughout the forecast period. In Denmark, demand for construction increased over the past five years.
While the recent change of government in Denmark may result in some revision of adopted plans, transport infrastructure looks set to remain a priority. Construction investments in Denmark have recently increased compared to the previous year. Apart from roads, streets, and railways, power stations and district heating plants, water and wastewater treatment plants, structural engineering activities linked to transportation, and post and telecommunications are included in the construction sector. Considerable resources are used to maintain and repair facilities in the construction market.
Fluctuating Demand For Residential Building Construction
The average dealing price on owner-occupied flats for sale increased slightly by 0.3% Y-o-Y to DKK 33,674 (USD 4,886) per square meter. But when inflation is taken into account, prices fall by 1.9%. However, in the third quarter of 2023, prices increased by only 3.4% every quarter.
Holiday home prices dropped by 1.6% Y-o-Y to an average of DKK 21,270 (USD 3,086) per square meter. The prices during the latest quarter have decreased by 1.5% compared to the previous quarter.
Statistics Denmark demonstrated the price index of one-family houses in Denmark fell by 3% in Q2 2023 from a year earlier, observing Y-o-Y declines of 5.9% in Q1 2023, 5.7% in Q4 2022, and 2.1% in Q3 2022. Although quarterly, nationwide home prices increased by a modest 2.5% in Q2 2023, indicating a decelerated fall rate.
There was also a sharp decline in housing construction activity. In the first three quarters of 2023, housing permits fell by more than 39% yearly. Housing starts and completions also fell by 36% and 2.3%, respectively. The number of houses in construction decreased by 48.5% annually to 27,362 from September 2023, the least since March 2002.
