● THE FINNISH PROPERTY MARKET NEWSEC PROPERTY OUTLOOK • SPRING 2022
THE FINNISH PROPERTY MARKET
2021 – A YEAR OF UPS AND DOWNS BUT A PROMISING FORECAST GOING INTO 2022 The Finnish economy has, much like the rest of the world, been affected by covid-19 in 2021. Despite hitting the intended 80% vaccination rate in the last quarter of the year, Finland has had strict restrictions in both society as well as for foreigners entering the country. The year of 2021 started slow, but the economy made quite a comeback in the last quarter where the unemployment rate dropped to the lowest it has been since before the pandemic. Economic sentiment hit all-time highs both in October and November and the inflation rate was at 3.7% in November, the highest it has been for over 10 years. Thus, hopes are high that Finland will maintain and also increase its economic growth in 2022.
The Nordic real estate markets saw exceptional activity in 2021, especially those in Sweden, Norway and Denmark, with new record-breaking transaction volumes. The 2021 Finnish
transaction volume was not a record volume, but the strongest since 2018. Since the Finnish market often follows the Nordic market with a slight delay, liquidity is expected to remain strong in 2022. Many indicators show that the increased activity of the second half of 2021 will continue, and with increased cross-border flows and active international investors in residential, office, logistics and public property segments, it is possible that record Finnish transaction volumes could be forthcoming in 2022.
Contact: Valtteri Vuorio valtteri.vuorio@newsec.fi
Photo: Shutterstock
The Finnish real estate market had a very different year in 2021 compared
to 2020. After the U-curve of 2020 in the real estate investment market (Q2-Q3 2020), activity intensified towards the end of the year. In 2021 on the other hand, the first quarter was quiet, followed by a booming spring and summer. In the last quarter of 2021, trading volume was EUR 2.42 billion. In the light of history, this is a high number, as the average quarterly trading volume in 2015-2021 has been EUR 1.8 billion. Consequently, market liquidity remains strong, with an active end of the year carrying momentum into early 2022. Finland's transaction volume in total was approximately EUR 7 billion in 2021.
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