The decline in construction production continued

According to Statistics Estonia, in the 2nd quarter of 2008 compared to the same period of the previous year, the total production of Estonian construction enterprises in Estonia and in foreign countries decreased 6%. The decline in construction production that had started at the beginning of the present year continued in the 2nd quarter, too.

In the 2nd quarter of 2008 the production value of construction enterprises amounted to 9.7 billion kroons, of which the production value of building construction was 6.4 billion kroons and the production of civil engineering totalled 3.3 billion kroons. Compared to the same period of 2007 the volume of building construction decreased 12%, but the volume of civil engineering increased 10%. It was mainly caused by the decreased volumes in dwelling construction on domestic construction market. Although the volume of civil engineering grew, its influence on the construction activity was small, accounting for only a third of the total volume of construction.

Contrary to the domestic construction market which is on decline stage, the construction volume in foreign countries increased about 2% compared to the same period a year ago. The growth was caused by the building construction.

According to the data of the Register of Construction Works, in the 2nd quarter of 2008 the number of dwelling completions was 1,398, i.e. 559 dwellings less than in the same period of 2007. Similarly to the previous years, more than three quarters of completed dwellings were situated in blocks of flats. The recession, continuous increase in interest rates of settlement loans and difficulties in selling existing dwellings decreased continuously the demand for new dwellings. In the 2nd quarter of 2008 building permits were granted for the construction of 2,143 dwellings, which is a third less compared to the same period of 2007.

In the 2nd quarter of 2008, the number of completed non-residential buildings was 249 with the useful floor area of 268,000 square metres. The useful floor area of commercial and industrial buildings increased the most. Compared to the same period of 2007, the useful floor area and the cubic capacity of completed non-residential buildings increased.

Trend of construction volume index, 1st quarter 2000 – 2nd quarter 2008
(average of quarters of 2000 = 100)

 

Source: Statistics Estonia

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