Advertisement
What really powers the cloud? Behind every Google search, A...
A lot of what defines a home isn’t visible at handover. I...
Private equity has played a significant role in shaping Indi...
Luxury real estate is one of the most talked-about segments ...
Airports play a much bigger role than just enabling travel -...
Germany’s housing construction sector saw a sharp slowdown last year, with residential completions falling to their lowest level since 2012. Data released by the country’s statistics office showed that completed residential units declined 18% year-on-year to 206,600 units, marking the second straight annual drop. Rising construction costs, elevated borrowing rates and lengthy approval processes continued to affect new housing activity across the country. Industry experts have called for faster deregulation and policy support, while the government said building permits had started improving and financial support for lower-income housing projects had reached record levels.
Germany’s residential construction activity declined significantly last year as developers continued to struggle with higher financing costs, expensive building materials and regulatory delays. Advertisement
According to data released by Germany’s national statistics office during the week, the number of completed residential units across houses, apartment buildings and other residential properties dropped 18% year-on-year to 206,600 units. The figure marked the lowest level recorded in the country since 2012 and reflected the second consecutive annual decline in housing completions.
The slowdown comes at a time when Germany has been facing persistent housing shortages in several urban regions, particularly in larger cities where demand for affordable housing has remained high. Rising interest rates over the past two years have increased borrowing costs for both developers and homebuyers, leading many projects to be delayed, redesigned or shelved.
Ludwig Dorffmeister, a housing sector expert at the Ifo Institute, said construction activity remained heavily burdened by complex procedures, high costs and extensive regulations, adding that project execution continued to take too long. The institute expects completed residential units to decline further to around 185,000 units this year.
The housing slowdown has added pressure on the German government to simplify approval systems and accelerate support measures for the construction sector. Germany’s Construction Minister Verena Hubertz described the latest figures as weak but noted that early signs of recovery were emerging in permit activity.
She said state-backed support programmes for low-income households had reached record levels, indicating stronger public intervention to support affordable housing development.
Separate data released earlier this year showed that residential construction permits in Germany increased 11.5% year-on-year in March to 21,800 units, suggesting that developers may gradually begin reviving stalled projects if financing conditions improve.
The German housing market has remained under pressure since the European Central Bank’s aggressive rate tightening cycle began in response to inflation after the energy crisis and supply disruptions that followed the Russia-Ukraine conflict. Higher energy-efficient building standards and labour shortages have also increased development costs across the sector over the past few years.
Source Reuters
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
