In order for rents to be affordable, Germany needs hundreds of thousands of new apartments. That is what the new government is committed to. But building has its price.
Building will remain a costly affair in the New Year too.
The construction industry expects that the supply chains will be intact again in spring and that material will no longer be so scarce. The price increase is unlikely to reverse completely, said Peter Huebner, President of the Main Association of the German Construction Industry, on Thursday. This is due to high demand, which is likely to increase, especially in residential construction.
After a price increase of 6.5 percent this year, the industry expects 4 percent in 2022. In the past few months, wood, steel, insulation and other building materials had become scarce. The reasons were limited transport capacities and high international demand.
Expensive lumber
“The industry is struggling with the side effects of the pandemic,” said Reinhard Quast, President of the Central Association of the German Construction Industry, in Siegen. Construction timber still cost almost twice as much as a year ago, steel is 70 percent more expensive, pipes and insulation materials 30 percent. Quast stated, however: “We now seem to have reached the peak of price dynamics.”
The new federal government aims to build 400,000 apartments per year. According to industry estimates, this year it should have been 310,000. “400,000 apartments is a mega-ambitious goal,” said Hübner in Cologne. The industry expects around 320,000 apartments to be ready in the next year.
For even more new buildings, more affordable building land and building and planning law simplifications are necessary, for example to build more in series and in modules. However, additional restrictions on rents would deter investors, said Huebner. According to Quast, more work permits are needed for construction workers from the Western Balkans.
Overall, good business is expected. “The high order backlog indicates a nominal increase in sales of around 5.5 percent to 151 billion in 2022.” Taking into account the price increase, there is real growth of 1.5 percent. The industry is cautiously optimistic about the new year. “All in all, the construction industry remains a pillar of the economy in Germany,” said Quast. The number of employees in the industry will increase by around 10,000 to 915,000.
For 2021, the industry is assuming sales of 143.5 billion euros. That would be 500 million euros more than last year.
Source From: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
