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Construction sites in Berlin in 2017: heavy losses in incoming orders
Photo: Jens Kalaene / dpa
Inflation and the energy crisis are burdening many construction projects.
The building ministers of the federal states still want to push housing construction forward - and have made specific demands.
At their conference in Stuttgart, state ministers demanded that procedures would have to be simplified so that rapid construction would be possible – and the federal government would have to take on a higher share of the housing benefit than it has in the past.
The housing allowance is also to increase by an average of 190 euros.
This emerges from a draft by Minister of Construction Klara Geywitz.
As a result of the reform, which was initiated because of the high energy costs, housing benefit households should then receive around 370 euros a month on average.
So far, the average support is 177 euros per month and household.
The circle of beneficiaries is also to be significantly expanded: in addition to the current 600,000 households, there will be up to 1.4 million more households whose income now falls below the new housing benefit threshold.
In the future, people who earn minimum wage or have a pension of a comparable amount should also receive housing benefit.
"Building and housing must remain affordable," said Baden-Württemberg's department head, Nicole Razavi, who chaired the conference.
According to the CDU politician, it is also a question of social peace.
The chancellor's mantra, "You'll never walk alone," must also apply to the area of construction and housing.
The traffic light coalition agreed on this reform at the beginning of September with the planned third relief package.
In the short term, there will also be another heating cost subsidy, which will later be permanently integrated into the housing allowance.
Project developers hesitate because of incalculable costs
Baden-Württemberg's Minister Razavi also spoke out in favor of funding construction that is open to all technologies, because people shouldn't lose their enthusiasm for building.
"We have to take a critical look at everything that makes house building more difficult," she said.
The triad is: relieve, accelerate, set incentives.
In fact, new construction in Germany has come to a standstill due to material supply bottlenecks, sharply rising prices and more expensive financing.
Project developers who plan entire residential or commercial areas are reluctant because they can hardly calculate.
Private householders are also canceling construction projects due to cost increases.
The Munich Ifo Institute is observing an increasing number of cancellations in residential construction.
The Central Association of the German Construction Industry (ZDB) is already recording a sharp drop in incoming orders in the industry.
The association sees the federal government's goal of building 400,000 new apartments a year as a long way off.
After more than ten years of boom, experts are also expecting a turnaround on the German real estate market, because interest rates for construction loans in particular have skyrocketed.
Hamburg's GEWOS Institute for Urban, Regional and Housing Research expects real estate sales to fall by seven percent this year to 313.5 billion euros - that would be the sharpest decline since 2009, after the global outbreak financial and economic crisis.
According to data from the Federal Statistical Office, the main construction trades recorded a higher volume of orders in July than a year earlier due to higher prices.
Price-adjusted (real), however, order intake was 5.8 percent lower.
Private home builders are suffering from rising interest rates
“Private home builders in particular are reaching the limits of what they can afford in view of rising financing and living costs,” said Felix Pakleppa, general manager of the Central Association of the German Construction Industry.
The announced funding of one billion euros for the new building is not nearly enough, and an energy price cap is also needed.
Despite this difficult environment for the construction industry, Federal Building Minister Geywitz is sticking to the goal of 400,000 new apartments per year.
“The goal is the goal.
And the goal is not a political invention, but derived from needs,” said the SPD politician after the conference of building ministers.
But it is also clear that the shortage of skilled workers, rising interest rates and material shortages will not make things any easier.
Geywitz also promised the states an increase in subsidies for social housing.
She also signaled that the federal government was open to the flexible use of funds by the federal states.
All the same, inflation for German residential real estate slowed somewhat in the second quarter.
From April to June they were an average of 10.2 percent more expensive compared to the same period last year, as reported by the Federal Statistical Office, but were still over ten percent for the fifth time in a row.
However, according to experts, there are also signs of a trend reversal on the German real estate market due to the sharp rise in interest rates.
In many places, the demand for properties to buy already collapsed in the second quarter.
ani/dpa/Reuters
