According to Veidekke, one of Scandinavia’s largest contractors, following a challenging 2024, in which the market shrank by 11%, forecasts indicate a slowing of the decline to 4% in 2025. Starting in 2026, a clear recovery is expected in the construction market, driven by increased residential construction and ongoing high infrastructure investment across Scandinavia.
“While the market continues to feel the effects of interest rate increases and high inflation in 2022 and 2023, we are now seeing clear signs of stabilisation. Interest rate cuts in Sweden and rising house prices and purchasing power in Norway give reason to believe in a gradual recovery,” said Veidekke Head of Insight and Analysis, Kristoffer Eide Hoen.
“Geopolitical unrest is also creating uncertainty in the construction industry, but previous experience suggests that the industry is considerably more sheltered than, for example, the export industry. Other than large-scale defence investment, it is currently difficult to identify concrete impacts in our target markets,” said Hoen.
Sweden is expected to lead the way in the predicted upturn, and Veidekke has already observed an increase in the number of building starts involving commercial buildings, apartments and small houses since the summer of 2024. It is estimated that approximately half of the decline suffered by the Scandinavian contracting markets in recent years will be recovered by the end of 2026.
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