Building
Construction industry recovers: Significantly more orders in October
The ailing German construction industry can look forward to more orders in the fall. Falling interest rates give hope for the new year.
A ray of hope for the struggling German construction industry: In October, orders for the main construction industry rose significantly, as the Federal Statistical Office in Wiesbaden announced.
Incoming orders grew by 5.6 percent compared to the previous month in September – both in building construction, which is dominated by residential construction, and in civil engineering, which includes road construction. At the same time, sales in the construction industry rose by 1.7 percent, adjusted for prices, compared to the same month last year.
From January to October, however, the balance is mixed: incoming orders fell by 1.9 percent, adjusted for prices, compared to the same period last year. Sales fell by one percent in the ten months.
Hoping for interest rates to fall
The construction industry’s hopes are focused on further falling key interest rates from the European Central Bank (ECB) in 2025. After four interest rate cuts this year, construction interest rates have fallen noticeably. Consumers are therefore increasingly turning to real estate loans again.
The construction industry association ZDB expects the construction industry to stabilize at a low level in 2025. ZDB President Wolfgang Schubert-Raab recently said that the trough of the crisis has been reached, especially in housing construction.
Increased construction costs and interest rates have caused serious problems for the construction industry, especially in residential construction: The ZDB expects 250,000 to 255,000 new apartments nationwide this year. That would be significantly fewer than in 2023 (around 295,000) and far away from the federal government’s goal of 400,000 new apartments annually.
dpa
Source: Stern
