63% of timber construction companies described their order situation in the third quarter as good and 22% as satisfactory. As for the fourth quarter, the vast majority (76%) expect the order situation to remain the same, while 10% predict an improvement and 14% a deterioration.
Single-family homes as “problem child”
In the next six months, 59% of the surveyed companies expect no change in the order situation in the single- and two-family home construction segment, while 31% think that it will get worse. Similar assessments were made when it comes to multi-story timber construction. Here, 41% expect the order situation to remain the same, while 29% believe that the number of orders will decrease. Only in the segments renovation/extension/annexes/addition of stories are respondents more optimistic, with 55% not expecting any change, while 31% think that the situation will improve.
Renovations, extensions, addition of stories as clear drivers
Assessments regarding the next five years paint a clear picture. When it comes to residential complexes, 42% of timber construction companies predict that the business situation will see an average development. 22% believe in a deterioration of the business situation and 19% in an improvement. As for single-family homes, 43% expect a bad business situation, 28% think that it will be average, and 19% even expect the business situation to be very bad. A more positive outlook can be observed when it comes to multi-generational homes. 37% of the surveyed companies expect an average development, 36% predict a positive and 20% a negative development. In commercial construction, an average order situation is expected by 42% of survey participants, compared to 25% who believe in a positive or negative development.
The segments in which timber construction can play to its strengths are considered to be the clear drivers of growth in the next five years. In the addition of stories segment, 19% of survey participants predict a very good order situation, 53% expect it to be good, and 24% think that it will be average. As for the extensions and annexes segment, a very positive development is expected by 20% of timber construction companies, a good one by 59% and an average development by 17%. Renovations are also a very popular segment. Here, 20% many respondents predict a very good (20%) or good (47%) order situation, while 27% expect it to be average. When it comes to urban densification, the majority (39%) predict an average development, and 31% expect business to be good.
Biggest challenges at the moment:
- Significant decrease in construction activity, especially in the single-family home segment
- Despite the challenges, order books are full in some areas
- Difficulty finding qualified staff
- Companies having to adapt operations because they are short-staffed.
- Uncertainty as a result of price fluctuations among suppliers
- Political framework conditions are perceived as a hindrance, both in the construction industry and in lending.
- Political requirements (e.g. ESG forms) in particular to make it more difficult for banks to give people and businesses access to financing.
- Considerable effort is required to meet requirements from authorities, which puts a strain on operations and requires more staff.
- Building regulations are perceived as overly complicated and impractical, especially in timber construction.
- The desire for incentives for projects in the renovation segment in order to increase the renovation rate.
- Insulation values are not assessed correctly, which leads to unnecessary, environmentally harmful measures.
- The need for fewer or less complex regulations in timber construction.
