All right. Good morning, everyone, and welcome to YIT's Q4 2021 Silent Call. My name is Tommi Järvenpää. I am the Head of Investor Relations at YIT, and with me here today is also our Chief Executive Officer, Tuomas Mäkipeska. We will first have a short presentation by Tuomas, a summary about the quarter, and then after that, we will then go to Q&A part of the call. As a reminder, this call will be recorded and published later on our website. Tuomas, go ahead.
Thank you, Tommi, and hey, good morning on my behalf as well. My pleasure to host my first Silent Call here at YIT with you guys. I will briefly go through major topics on group level and then just brief comments on segment level as well. Starting with a comment on our quarter, we have had a solid quarter as a group so far and in majority of segments as well. As announced earlier, we realized EUR 45 million positive EBIT impact from Lestijärvi wind farm sale. This was a successful project of our infra segment, and we are, of course, happy about the outcome of this Lestijärvi wind farm sale.
Also, we announced earlier during November that we are expecting margin reductions of approximately EUR 50 million during Q4, which is basically caused by certain legacy projects and projects that are not in the core of YIT's new strategy. We have these kind of projects in every segment. It is not totally allocated to one or two of our segments. It is basically throughout our segments, the impact. A comment on material cost inflation. Basically, the rise of prices has slowed down in Q4, and we have been able to absorb the effect pretty well by, of course, negotiating with the suppliers and utilizing the long contracts that we have, but also passing the cost increases over to the selling prices. Of course, the inflation will have a small impact on our next year's profitability as well, but it seems not to be significant at the current situation.
Of course, if the inflation would then continue on a high level or even accelerate from the current level, this would then impact negatively our next year's profits as well. Couple of comments regarding the segments. First of all, in housing segment, we have had a seasonally high number of completions during Q4, but still lower amount compared to the previous Q4, year 2020. One reminder that we have been slowing down our startups because of the COVID situation starting last spring. Sorry, spring 2020. Of course, this will have an impact on our volumes. That has had an impact on our volumes in Q4, and this will have an impact, of course, on next year's volumes as well.
But since we have been accelerating the startups now during this year's H2, I would say, this will then have a positive impact on volumes at the end of next year and in the year 2023. Market demand in housing continues to be strong. There are, of course, small deviations between the regions, but overall, the market looks good, as mentioned earlier as well. In Russia, also, we have had so far another strong quarter. The demand continues strong, and maybe the big thing that we announced earlier is that we are currently evaluating our strategic options in Russia, and the process is ongoing. In business premises, the underlying business is performing better than before, and the turnaround that we are executing there is progressing basically well.
We have older legacy projects that we have a pressure to reduce margins, and this will have an impact, of course, on this year's numbers in terms of profitability, but the underlying business is healthier than before and the turnaround is progressing well, as mentioned. In infra segment, as mentioned, the biggest thing was, of course, the Lestijärvi sales, and it is booked in infra segment numbers in Q4. That is the big positive impact for Q4 numbers. But also we have margin reductions from certain legacy projects, and large part of the margin reductions are in infra projects. In general, the infra projects are pretty long and the financial impacts are pretty long. Since we are just started the turnaround in infra segment, it will take some time to make the business healthier and performing better.
Property development segment, as mentioned, it is our partnership properties still this year, but starting next year as a property development. So we are setting up the new operating model as described in our strategy. The market itself looks attractive. There are several discussions going on, and the market demand is strong. For example, during the Q4, we announced that we will form a joint venture with HGR and Ilmarinen to establish regarding the real estate development activities in Keilaniemi. In a big picture also, property development is starting to execute its new strategy. Basically these were brief comments from the group and from the segments. Tommi, I guess we are now happy to take your questions.
Yes, indeed. As always, please use the raise hand function to ask a question. I think the first question then will come from Svante. Go ahead.
Yes, good morning, and thanks for the presentation and taking my questions. The first one, you mentioned that there is margin reductions in every segment. Does that include also housing or how should we read it?
Well, yes. As mentioned, we mainly have two kinds of projects. Older legacy projects that we have a pressure to reduce margins. That is one kind of a basket. Then we have some projects that are not in the core of the new strategy. Basically we have two baskets of these kind of projects. This goes to all of our segments, also including housing.
May I ask, what kind of non-core projects do you have in housing?
Well, that is something that we are not disclosing at this point, but, we have been looking our project portfolio through the lenses of our new strategy. This means that in every segment there is those kind of projects that are not maybe continued in the future.
Okay. Should we assume that the housing projects are in locations that you don't want to be present in?
For example, yes.
Is that the same for legacy project in business premises also? Is it the location or other factors?
Well, there are other factors as well in business premises and in infra segment. It's not solely dependent on the location. There are, of course, points, for example, contractual issues and so on. There are several factors impacting is that, is the project kind of in line with our new strategy, to put it that way.
Okay. Then, the last one from me. What does the investor demand in housing look in different regions? I mean, the rental market in the capital region is quite poor currently. So what kind of developments do you see on the demand side?
Well, as mentioned, the demand, there is kind of minor deviations between the regions. But if you look at the big picture, overall demand in Finland and also in CEE countries is very strong. Basically the situation what we have now, we have extremely low number of completed, not sold apartments at this point. So that's a good indicator of the market. Overall the market looks promising and we are kind of looking forward to see is the market demand continue to be strong during the next year as well.
Okay. Thank you.
Thanks, Svante. Then Anssi next.
Thanks, guys. One question from me. During the quarter, you have sold couple of projects in Tampere, in Helsinki center, in Baltics. Will there be any significant impact for Q4 result or will the result be kind of booked in while the projects are executed? That's the question. Thanks.
Well, basically that we've been selling during the Q4, it's business as usual. Nothing kind of a deviation from normal, if I understood your question correctly. This is more of a business as usual. No big swings in Q4 results, because of those.
Okay. Thanks for that.
Bye, Anssi. Any further questions? All right. Seems that there's no further questions, so I guess that means that we will conclude at this point. We will then announce our results early February, and then I guess that will be the next time we will be talking. At this point, we will wish you happy holidays.
Happy holidays.
Thank you, and same to you.
Thank you.
Thanks. Happy holidays.
Same to you guys.
Thanks.
Thank you. Same.