Lack of housing and low numbers of new buildings are putting a strain on the real estate sector - financial experts warn of rising costs for renovations

Lack of housing and low numbers of new buildings are putting a strain on the real estate sector - financial experts warn of rising costs for renovations

A lack of housing and a low number of new buildings are currently putting a strain on the real estate sector. At the same time, the conditions for renovations seem to be becoming increasingly unfavorable. According to a study commissioned by the Federal Association for Energy-Efficient Building Envelopes, the rate for renovations in the German building stock is currently only 0.83 percent. A survey by the Bauherren-Schutzbund association also showed that only around a third of owner-occupiers with older properties are planning energy-related modernization measures. The high construction costs are one of the main reasons why neither renovation nor modernization measures are making progress. In this context, the legislature is planning a new regulation to reform the Hazardous Substances Ordinance, which could further increase the costs of renovations.

According to a report from www.merkur.de, according to the draft paragraph 5a, paragraph 2, all work on existing buildings that were built before October 31, 1993 should be carried out without specific suspicion under complete asbestos protection measures and waste disposal as hazardous waste. This procedure is extremely complex and correspondingly expensive. In order to avoid this “disposal on suspicion”, private property owners must have measurements carried out to prove that they are free of asbestos contamination. However, this is expensive and experts are also scarce. It has also not yet been finally clarified whether the clearance measurements meet the requirements of waste law.

The Association of Private Builders (VPB) criticizes this reform of the Hazardous Substances Ordinance. The lobbyists are not interested in saving on necessary protective measures, but rather that private developers, as the weakest link in the chain, should be held solely responsible for the examination and disposal of possible contaminated sites. Construction laypeople in particular are often unable to judge for themselves whether the material being installed is dangerous or not. This could lead to unnecessary additional financial burdens and increase the costs of disposing of building materials as hazardous waste without offering more health protection.

This planned regulation could have a significant impact on the real estate market and the industry. Construction costs would continue to rise, which could probably have an even greater impact on the already low renovation rate. In addition, private developers could face financial challenges as they would be responsible for inspecting and disposing of possible contaminated sites. This could lead to fewer builders carrying out modernization measures, which would put additional strain on the market.

Source: According to a report by Mercury