Overall construction activity
The construction activity in 2025 is set to experience moderate growth after a weak performance in 2024. The sector is expected to rebound, driven by decreasing interest rates, rising real wages, and significant public investments. Despite the downturn in 2023 and 2024, construction employment remains high. The workforce adjustment to lowered activity levels is predicted to result in a slight reduction of 450 personnel in 2025, with a stabilization and increase of 1,550 employees in 2026, primarily due to increased public building and civil engineering investments. The professional construction activity, inclusive of maintenance, renovation, and new projects, indicates a less aggressive expansion for 2025, reflecting a cautious yet positive outlook.
Housebuilding
The housebuilding sector has shown considerable volatility. It reached a peak in 2021 with about 45,000 new homes but saw a significant drop to 31,500 in 2023. This decline is attributed to higher interest rates and inflation, which constrained borrowing and reduced housing market activity. 2024 is projected to be another year of reduced residential construction, with around 26,000 new homes initiated, reflecting a continued slump from 2023. However, as interest rates are anticipated to decrease further in late 2024 and into 2025, the number of new housing starts is estimated to rise modestly to 27,000 in 2025 and 28,000 in 2026. The falling interest rates and recovering real wages are expected to revitalize housebuilding investments, reversing the prior downturn and supporting gradual growth.
Non-residential construction
The non-residential building sector experienced a significant downturn in 2023, with a 30% drop in initiated projects compared to 2022. This decline brought the activity below pre-pandemic levels, though revisions of statistics throughout 2024 confirmed the downward trend's accuracy. Moving forward, the sector is poised for a slow recovery, contingent on improved financial conditions and increased industrial production outside the pharmaceutical industry. The anticipated decline in interest rates is likely to spur renewed industrial and commercial building investments, with projections indicating a 2.9% growth in 2025 and a more moderate 1.6% increase in 2026. This growth will be driven by better financing opportunities and a stabilization of the broader economic environment, though the rate of investment recovery is expected to be slow, reflecting lingering uncertainty.
GDP 2024
BILLION
POPULATION 2024
Total investment in construction in 2024
BILLION
Civil engineering
Civil engineering activities continue to show robust growth, supported by ongoing large-scale projects like the Femern Belt connection, Lynetteholm, and infrastructure upgrades under the Infrastructure Plan 2035. This sector remains resilient, buoyed by substantial long-term investments in green energy transformation, including fjernvarme (district heating) and enhancements to electricity grids necessary to meet ambitious climate goals. The sustained high level of activity from these projects ensures positive growth contributions through 2026. Anticipated growth rates within civil engineering are predicted to be 7.1% in 2025 and 6.5% in 2026, underscoring the durability of this sector's expansion and its pivotal role in maintaining high employment levels within the construction industry. Public sector investments have been critical, with forecasted increases of 4.5%, 7.1%, and 6% in 2024, 2025, and 2026, respectively.
Prices of construction materials
Between Q1 2022 and Q4 2024, construction material prices showed varying trends. Steel prices peaked at 125.07 in Q2 2022, but consistently declined to 77.41 by Q4 2024. Cement prices steadily increased from 100.00 to 118.76 by Q4 2023, with slight fluctuations, settling at 113.93 in Q4 2024. Bitumen saw a peak at 130.71 in Q2 2022 but dropped to 86.75 by Q4 2024. Wood prices remained relatively stable, hovering around 100.00 throughout the period.
Business registration and bankruptcy
Between 2020 and 2024, business registrations and bankruptcy declarations showed contrasting trends. Business registrations decreased steadily from 100.00 in 2020 to 76.40 in 2024, indicating lower entrepreneurial activity. Conversely, bankruptcy declarations increased from the base index of 100.00 in 2020 to a peak of 131.22 in 2023. In the level is about 17 percent above the level of bankruptcy declarations in 2020.
Construction activity.
Number of building permits in residential construction
