● THE FINNISH PROPERTY MARKET NEWSEC PROPERTY OUTLOOK • SPRING 2021
THE FINNISH PROPERTY MARKET STRONG PEAK IN Q4 2020 – WITH SUBSTANTIAL POTENTIAL IN 2021 which will continue to support the Finnish economy. Amid covid-19, Finland saw a real estate transaction volume of EUR 6.0 billion in 2020, in line with the historical average. The Finnish transaction volume in 2020 was u-shaped, with a very active first quarter, and a second quarter that was very quiet. In the third quarter, activity remained low, while the last quarter was more active than 2019. Shopping centre and hotel investments froze at the beginning of the pandemic, especially when the restrictions kicked in. Many investors turned to more defensive investments such as residential and logistics; with
increasing urbanization and e-commerce being the main drivers. Public properties have also been seen as a very interesting segment, which has also been a trend in the other Nordic countries. Some transactions were postponed to 2021 and the beginning of the year has been active. Investors are clearly searching far and wide for property and there is still a lot of capital trying to find good investments. As a result, 2021 is expected to be a strong year for the property market.
Contact: Olli-Pekka Mustonen olli-pekka.mustonen@newsec.fi
Photo: Shutterstock
The Finnish economy was substantially impacted by the covid-19 virus in 2020 and thus far in 2021, with GDP dropping by -4.3% in 2020. Much like the rest of the Nordics and in Europe in general, unemployment rose in Finland, too, with relatively severe restrictions being introduced in the country. However, Finnish covid-19 death and infection rates have also been among the lowest in Europe, and a solid recovery in GDP growth of 2.9% is expected to follow in 2021. Finland also has strong state finances and is able to enact further stimulus if required. The European Central Bank is also likely to keep the key interest rate low for the foreseeable future,
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