Alarming situation: Housing construction in Germany continues to be in crisis

Alarming situation: Housing construction in Germany continues to be in crisis

Housing construction in Germany is still in crisis, and the alarming signals from construction and real estate associations are becoming increasingly dramatic. At the “Housing Construction Day” organized by an alliance of associations, it was found that completions are continuing to decline and the need for affordable rental apartments has increased dramatically. The President of the Federal Association of German Housing and Real Estate Companies (GdW), Axel Gedaschko, emphasized that the new building was no longer affordable under the current conditions, neither for the builders nor for future tenants.

The real estate industry says that there is already a shortage of 800,000 apartments in Germany, an increase of 100,000 compared to the previous year. Immediate special funding of 23 billion euros is called for, including 15 billion euros for 100,000 new social housing and 8 billion euros for the construction of 60,000 affordable homes. The President of the Federal Association of German Building Materials Trade, Katharina Metzger, described the industry as witnessing a historic crash, with some manufacturers already on short-time work.

Federal Construction Minister Klara Geywitz (SPD) accepted the demands from the industry at the Housing Construction Day, but rejected new subsidies. She emphasized that not everything can be subsidized and referred to reform projects that are already underway. The federal government is currently promoting low-interest loans for climate-friendly new buildings through a KfW program. Together with the states, they have made a record amount available for social housing and are reporting an increase in the construction of price-controlled apartments.

It also points to a partnership between the federal and state governments for planning and acceleration, with relaxations in regulations for car parking spaces. A lowering of construction standards is required in order to be able to build more easily, cheaply and quickly. The head of IG Bauen-Agrar-Umwelt Robert Feiger predicts a decline in total investment in residential construction of around 5.5 percent this year. The Schleswig-Holstein Working Group for Contemporary Building ARGE warns of the growing gap between construction activity and immigration, which leaves the industry strategically inadequately positioned.

Overall, there are many challenges in housing construction, from rising construction costs to the lack of affordable housing. It is becoming clear that the situation requires urgent action to tackle the housing crisis in Germany.