Housing construction in NRW faces a difficult year: New apartments will decline again in 2024 according to NRW.Bank

Housing construction in NRW faces a difficult year: New apartments will decline again in 2024 according to NRW.Bank

According to a report by rp-online.de Housing construction in North Rhine-Westphalia faces major challenges. The NRW.Bank predicts a further decline in newly built apartments in 2024. The reasons for this are the increased construction costs, the high building land prices and the tripling of loan interest rates since 2021. As early as 2023, the current building conditions led to planned investments being stopped or postponed.

Construction costs have increased by more than 40 percent since mid-2019, which represents an enormous burden for builders. As a result, many construction projects are not profitable and investors are reluctant to start new projects. The high price of building land also makes the availability of suitable land for housing construction more difficult.

In combination with the tripling of loan interest rates since 2021, this leads to a difficult situation on the real estate market in North Rhine-Westphalia. This is expected to also impact rents and property prices as the supply of new homes decreases and demand remains high.

As an expert in the real estate market, I view these developments with concern and recommend that investors focus on alternative locations and construction projects in order to avoid the challenges in North Rhine-Westphalia.

Consequently, North Rhine-Westphalia appears to be facing a difficult year in housing construction, which will bring challenges for both developers and potential tenants and buyers of real estate.