Weak construction activity
Scholz: No systemic crisis in housing construction
05/31/2023 3:37 p.m
Despite rising interest rates and building prices, the federal government is sticking to its goal: 400,000 new apartments are to be built this year. With regard to the sluggish economy in the construction industry, the Chancellor says that a fairly abrupt adjustment is currently taking place.
Chancellor Olaf Scholz is promoting housing construction even in times of higher interest rates. According to the speech manuscript, the federal government wants to stick to the goal of 400,000 apartments per year despite the weak construction industry. “Affordable housing is one, if not the central social issue of our time,” said the SPD politician. In the past, even more apartments were built with even higher interest rates.
The Federal Statistical Office announced a few days ago that a total of 295,300 apartments were built in 2022, 0.6 percent more than in the previous year. The construction industry expects a maximum of 250,000 new homes this year. The federal government has provided funding of 14.5 billion euros for social housing for the period from 2022 to 2026. “That’s a record amount,” said Scholz in Hanover. At the same time, private investment is needed. He is “extremely grateful” to the savings banks for committing to financing new buildings and subsidized apartments.
With a view to the sluggish economy in the construction industry, he said: “What we are currently experiencing is a fairly abrupt adjustment, but not a systemic crisis.” He called for closer consultation with the federal, state, local authorities, construction industry and financial institutions. Together we can reduce construction costs. The elements here are more serial and modular construction, fewer standards, faster planning and approvals, digital building applications and the provision of more building land in the municipalities.