Building boom or construction collapse? This is how the German construction industry suffers!

Building boom or construction collapse? This is how the German construction industry suffers!

In the German construction industry there is an alarming situation that, despite a continuing need for living space, leads to shrinking the sector. In a current discussion, moderated by Markus Lanz, building expert Matthias Günther said that the industry suffers from the lack of demand, which leads to a massive degradation of capacities and the closure of building materials. In 2024, 251,900 apartments were completed in Germany - a decline in over 42,500 units compared to the previous year and the lowest value since 2015. The federal government has set itself the ambitious goal of creating 400,000 new apartments annually.

The new Minister of Construction Verena Hubertz (SPD) has promised to make massive investments in housing and to initiate a "construction turbo". However, there are no concrete figures on the planned investments, and the challenges are immense because her predecessor has already failed because of the target of 400,000 apartments.

difficult framework conditions

The framework conditions for housing are heavily contaminated by rising energy prices, inflation, delivery bottlenecks and expensive building material. The German Institute for Economic Research (DIW Berlin) reported that the construction volume in 2025 will decrease for the fifth year in a row and a minus of almost four percent for 2024 will be forecast. A decline of almost one percent is also expected for 2025. These developments are in a sharp contrast to the high goals of the federal government.

A decrease of ten percent is expected by 2026, especially in housing construction, compared to the top value of 2021. Study author Martin Gornig emphasizes the large gap between building needs and construction work, which urgently needs to be closed. In addition, an immediate program for social housing is considered necessary in order to counter the continuing shortage of housing in Germany, especially in the big cities.

The way to the future

A solution to escape the "fatal cycle" is the use of a "serial modular" construction, in which walls and cables are processed before delivery on the construction site. In this way, the construction could be designed faster and cheaper, but the effectiveness of this approach remains uncertain.

The number of building permits for new residential buildings has already reached the lowest level in 30 years. At the same time, the new construction prices for residential buildings were recently around 16 percent above the previous year, which made the situation even more difficult. Only about 259,000 new apartments were approved in 2023, while significantly less approved in previous years. The construction of single -family houses is particularly affected, the number of which was only half as high in 2023 as two years ago.

The challenges of the construction industry are huge and time is urged to provide the urgently needed living space. The Federal Government faces the challenge of achieving its ambitious goals, while the tendency continues to shrink the sector.

Further information about the current situation of the German construction industry and the housing construction can be found at vienna.at , Diw Berlin and Statista .