Public policy actions to promote innovations related business based house construction and related wood use enhancement have been wide in Finland from the mid 1990’s on but without many commercially successful innovations. This paper discusses national public policy activities in the two major clusters, real estate & construction and forest & wood product forest industry respectively. Major focus is in the challenges related to cross sectoral innovation processes that do not have position in cluster based national innovation policy favoring supply (technology) push innovation processes in financing in Finland from the mid 1990’s up to the mid 2000’s. Real estate & construction cluster enterprises tend to be risk averters in connection to new process and material solutions but have gradually from the early 2000’s started to adapt customer orientation, networking and building information models based on shared information and communication networks into their business models. Challenges to climate change mitigation and new carbon sinks have improved the potential competitive advantages of wood frame construction with respect to concrete and steel frame solutions. Innovation processes by wood product industry firms imply new orientation if they aim to BtoB demand segment outcomes. Recent Living Business program, characterized by cross cluster center of expertise networks is part of the new innovation policy approach. This try to counteract the prior low interests on cross cluster interactions, that have weakened innovation attempts to react on demand signals.