Circular economy in the Finnish housing construction : the influence of Finnish government policies and EU regulations on the sustainable development in the Finnish housing construction sector

Abstract

This thesis analyses the transition to a circular economy (CE) in the Finnish housing sector, focusing on the impact of EU and Finnish government policies and regulations. It investigates how regulatory frameworks influence the application of CE principles in the housing sector, in order to clarify both the supporting effects and the barriers they create. The study shows a clear shift from voluntary commitments to legal obligations, which is reflected in policies that standardize processes in the sector. Such as the EU Circular Economy Action Plan, the European Green Deal, Finland’s Circular Economy Roadmap 2016, the Strategic Circular Economy Programme 2021 and the Construction Act 2025. Despite the progress, the sector still faces significant challenges, for example, Finland’s circular materials penetration rate is only 0.6% compared to the EU average of 11.5%; recycled materials are at a disadvantage in terms of certification and costs; and SMEs often lack technical and financial capacity. The thesis concludes by emphasizing that the pace of CE development depends on the interaction between market readiness, technological capacity and clarity in regulatory implementation. Stronger certification schemes, incentives, and digital integration are essential to ensure Finland’s progress towards carbon neutrality by 2035.