On Wednesday, Swedish housing giant Skanska came up with its project Quarterly report For the third quarter.
It appears here that the company did not start building a single new home during the third quarter.
– Unfortunately, this is a confirmation of the trend we are seeing – very few homes are being built. We see in statistics that activity in housing construction is now very minimal, says Boligprodukterene Managing Director Lars Jakob Heim.
The company put a shovel in the ground on 2,800 homes in Europe in 2022, mostly in the Nordic countries, but it has only 500 so far in 2023. So the boom has now stalled.
The housing market is weak in the Nordic region, especially in Norway and Finland, so we are somewhat conservative there. The market is strongest in Central Europe. We are selling more there, says CEO Anders Danielsson of Skanska while presenting the report.
Skanska reports quarterly revenue of 40.3 billion Swedish krona, three billion more than in 2022. The quarter’s result was significantly lower than last year. 549 million Swedish krona, compared to 1.5 billion last year.
Skanska is a Swedish construction group with most of its business based in the Nordic countries, but also has projects and employees in large parts of Europe and the USA. There are 4,100 employees working in the company’s offices in Norway, according to their website.
The new numbers give optimism: – Reduced pressure on interest rates
High interest rates have serious consequences
Hem explains the complete cessation of construction as follows:
-There are many interacting causes. The most important of which is that the cost of construction has risen sharply. At the same time, many feel they have less money to spend, he says.
In addition, housing construction is strongly affected by rising interest rates.
The interest rate hits the market twice. Hem points out that financing new projects is more expensive, and clients have increased their expenses.
The director of Boligprodukterene fears that the consequences will be greater in a year or two, when the housing construction that began today is completed.
-This could lead to higher housing prices for the few homes that are built. They are the homes being started now that we will move into and buy all at once. That means the low activity has carried forward, and when the market turns around again, there will be far fewer people to build homes, he says.
An oil fund manager secures a luxury property for approximately DKK 100 million.
Sound the alarm about Oslo
Housing manufacturers sounded the alarm earlier this year as well. A fairly recent report from them showed that construction of only ten housing units in Oslo began in the third quarter. This was the lowest number measured in the entire country.
The Oslo Municipal Planning and Building Agency refuted these figures, and suggested that 82 start-up permits were granted in the third quarter.
– These are two completely different things. The important point is that Oslo municipality is talking about specific start permits. We measure actual activation. “Shovels in the ground,” Hem replied. E24.
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