Material and workers are missing
Despite the increase, new residential construction falls significantly short of the target mark
May 23, 2023, 2:14 p.m
A plus in the construction of new apartments sounds good at first, but it turns out to be small. For this reason, the federal government will clearly exceed the target of 400,000 apartments in 2022. But things are looking really bleak for the coming years.
The number of newly built apartments in Germany rose slightly by 0.6 percent to 295,300 last year, despite higher prices and supply bottlenecks. However, the former goal of the federal government of 400,000 new apartments per year was clearly missed. The 2020 level of 306,400 apartments was also not reached, as reported by the Federal Statistical Office in Wiesbaden. In the current year, the construction industry expects at best 250,000 completed apartments.
“Especially in the metropolitan areas and their surroundings, the housing shortage is cemented,” said the general manager of the German Construction Industry Association, Tim-Oliver Müller. There is hardly any improvement in sight in 2024 either, and the number of completions is likely to continue to fall in view of the collapse in building permits.
Despite the demand for housing, the number of permits has been falling since last year. Because of the sharp rise in interest rates on loans and high construction costs, many builders are holding back on projects or canceling them – from private house builders to large investors. Many construction projects came to a standstill last year due to a lack of skilled workers and bottlenecks in the supply of building materials.
Housing is taking longer and longer
At the end of 2022, the number of apartments approved but not yet completed was 884,800 (plus 38,400 compared to 2021). The average time from approval to completion has increased by around two months since global supply chains were disrupted by the corona pandemic – from 20 months in 2020 to 22 months in 2022, the Wiesbaden authority explained.
The figures include both construction completions for new buildings and construction work on existing buildings. There was a decline in single-family homes (minus 1.5 percent). The number of new apartments in two-family houses, on the other hand, rose significantly by 14.1 percent to 23,000. 150,200 new apartments were created in apartment buildings, 1.5 percent more than in the previous year. A 14.5 percent drop was recorded in dormitories.