Residential construction approvals in Germany in the three-month period of December through February were 3.5% higher than a year earlier, Kallanish hears from industry association Bauindustrie (Hauptverband der Deutschen Bauindustrie).
Although February was 2.3% down year-on-year, with 17,900 residential units approved, the association finds that that the three-month trend gives hope that the floor has been reached, after a long decline. This is especially the case for multi-storey buildings, which account for two thirds of residential construction, although the number of approvals in January and February was still down 1.3% y-o-y, totalling 18,500 units.
Family houses saw a respectable surge of 12.4% in January and February, but only against a continued weakness of less than 5,000 units per month since summer 2023. Private builders were especially discouraged by insecurity over inflation and interest rates, and rising costs of building materials, although not necessarily steel (see separate story on rebar).
In an earlier survey published at the beginning of the year, 79% of construction companies said they did not expect the construction crisis to end this year, but would not cut back on staff.
In March, the German government’s announcement of a €500 billion ($565 billion) special fund for infrastructure investment gave reason for new optimism. However, the distribution of the money still needs to be clarified, and Bauindustrie emphasises that medium-sized enterprises and municipal governments should get a share and have a say.
“We need a variety of projects of different sizes, so that especially medium-sized companies will benefit,” says managing director Tim-Oliver Müller. “After all, the renovation of a town hall takes different expertise than the replacement of a big bridge like the damaged autobahn bridge in Berlin.”
Christian Koehl Germany
