The order situation in German housing construction has improved somewhat. However, the shortage and its consequences will continue to keep companies busy for some time, according to the Ifo.
The order situation in German residential construction eased slightly in June. In a survey by the Munich-based Ifo Institute, fewer companies reported a lack of orders or cancellations. Specifically, the proportion of canceled orders fell from 15.1 to 13.7 percent. 50.2 percent of companies complained of a lack of orders, which was 1.5 points less than in May. After a brief increase at the beginning of the year, both values have been declining for several months, but are still unusually high.
“The lack of new orders is still a big problem,” says Ifo expert Klaus Wohlrabe. “Not much has changed in terms of financing costs. This is also reflected in the development of building permits.” Wohlrabe does not expect things to ease quickly: “If something is not ordered and approved today, it cannot be built for the time being.” In view of the current figures, it is not surprising that the business climate in residential construction is deeply in negative territory at minus 44.3 points, despite a slight improvement. “The industry is still a long way from being optimistic,” says Wohlrabe.
Source: Stern
