HOUSE PRICES in Finland will start declining at the end of this year and decline next year for the first time since 2015, predicts the Mortgage Society of Finland.
Hypo on Friday stated in its most recent real estate market review that the market is facing considerable headwinds in the form of rising interest rates and consumer prices and the waning of the injection of energy given by the remote-work boom.
House prices, it predicted, will creep up by 1.5 per cent this year due to a strong start to the year but drop by 0.5 per cent next year.
The upbeat employment situation and the financial buffers built up by households are the main factors supporting the market from the effects of rising interest rates, eroding purchasing power and the scrapping of support mechanisms introduced due to the pandemic. The employment situation taking a turn for the worse could send house prices into rapid decline.
“If the economy slows into a deep recession and labour markets stagnate, it will be a frosty time for the house market,” said Juhana Brotherus, the chief economist at Hypo.
Real house prices, meanwhile, will decrease irrespective of the employment situation because inflation and pay rises are expected to outstrip the increase in rents and real estate prices in the coming years.
Hypo also forecast that house prices in the capital region will this year develop at a more sluggish pace than in other parts of the country for the first time since 2008, sliding by a bit over one per cent in the coming six months. The year-on-year development, though, will remain positive due to a strong start to the year in the region.
House prices in the region are to rise by one per cent in 2022 and half a per cent in 2023.
The number of real estate sales in the region decreased by 11 per cent year-on-year in the second quarter of the year. Prices, on the other hand, were roughly a per cent higher even though the prices of one-room houses fell by almost two per cent.
In addition to the downward trend in the prices of small houses, historically high residential construction and high interest rates are expected to keep prices in check in the capital region – the latter due to its relatively high impact on neighbourhoods where house prices and, consequently, mortgages are higher than average.
Also Tampere is forecast to see a slowdown in real estate prices even though the city registered its highest net-migration gain in quarter-of-a-century earlier this year, according to Hypo. Brotherus and Juho Keskinen, an economist at Hypo, highlighted that it is positive that the capital region is not the growth driver in Finland.
Sliding prices are not expected to become a trend in either Tampere or Turku. While the number of sales in the cities decreased in the spring by over nine and five per cent respectively, the prices rose by five per cent in Tampere and dropped marginally in Turku.
Brotherus predicted that winter will arrive ahead of time in the real estate market as rising interest rates put a strain on borrowers and rising consumer prices gnaw away at the purchasing power of consumers in Finland.
The remote-work boom that elevated prices surprisingly significantly is similarly petering out.
House prices in the capital region have surged by eight per cent and those in other parts of the country by six per cent during the pandemic. The prices of larger houses surged especially in and around growth centres as households of knowledge workers looked for more floor space for their remote-work setups.
“Remote work will surely remain a part of the daily lives of knowledge workers in cities, but not as dominant one as it was during the two exceptional years,” he said.
Aleksi Teivainen – HT
House prices in Finland to decline in 2023 for the first time since 2015 & Latest News Update
House prices in Finland to decline in 2023 for the first time since 2015 & More Live News
All this news that I have made and shared for you people, you will like it very much and in it we keep bringing topics for you people like every time so that you keep getting news information like trending topics and you It is our goal to be able to get
all kinds of news without going through us so that we can reach you the latest and best news for free so that you can move ahead further by getting the information of that news together with you. Later on, we will continue
to give information about more today world news update types of latest news through posts on our website so that you always keep moving forward in that news and whatever kind of information will be there, it will definitely be conveyed to you people.
House prices in Finland to decline in 2023 for the first time since 2015 & More News Today
All this news that I have brought up to you or will be the most different and best news that you people are not going to get anywhere, along with the information Trending News, Breaking News, Health News, Science News, Sports News, Entertainment News, Technology News, Business News, World News of this made available to all of you so that you are always connected with the news, stay ahead in the matter and keep getting today news all types of news for free till today so that you can get the news by getting it. Always take two steps forward
Credit Goes To News Website – This Original Content Owner News Website . This Is Not My Content So If You Want To Read Original Content You Can Follow Below Links