On Tuesday, Bloomberg reported that the Finnish housing market is entering a downturn as new home construction has plummeted to levels not seen since World War II.

New home construction was cut by more than half this year, coming in at roughly 16,000, compared to over 37,000 new homes built in 2022, according to data cited by the outlet from the Confederation of Finnish Construction Industries.

Estimates are for the Finnish construction industry to see a 10% decline overall this year.

In a statement, the construction group said, “Due to the collapse of housing production, the number of completed apartments threatens to fall to the level of the 1940s in the next couple of years. The rise in interest rates and costs has frozen both consumer and investor demand for new apartments as well as government-subsidized housing construction.”

Jouni Vihmo, the chief economist of the confederation, said that construction activity in Finland will not pick up until there is a stabilization of the interest rate outlook. He added before the housing market could recover there would have to be a reduction in the stock of new homes and a rebound for older dwellings.

He also warned that of the 160,000 jobs presently supplied to the economy by the construction sector, the current downturn may lead to a shedding of up to 30,000 of those jobs.