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Construction prices: Strongest increase in new properties in Germany for over 50 years

2022-01-10T23:09:41.981Z


The construction of new residential properties in Germany has become more expensive in November 2021 than it has been since 1970. It is not just the lack of material that is driving prices up.


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Rapid rise:

Construction prices keep soaring

Photo: Jörg Carstensen / dpa

The construction prices of residential buildings in Germany rose more sharply in November than in more than 50 years.

They increased by an average of 14.4 percent compared to the same month last year, as the Federal Statistical Office announced on Monday.

This is the highest year-on-year increase in construction prices since August 1970. In the previous reporting month, August 2021, prices were up 12.6 percent year-on-year.

Shortages of building materials

The reason: Wood, steel, insulation and other building materials have become scarce in the past few months.

Limited transport capacities and high international demand in the wake of the economic recovery after the corona crisis year 2020 are causing bottlenecks.

According to the information, carpentry and wood construction rose above average in November, which cost 38.9 percent more than a year earlier due to the increased demand for construction timber at home and abroad.

An early relaxation on the price front is not to be expected

, according to the craftsman president

Hans Peter Wollseifer

. "Building will become more expensive in the future, not just because wages are rising, but because the prices of materials are rising," said Wollseifer recently. "It is already becoming apparent that prices - even if the material shortages are eased - will not completely fall back to the pre-crisis level."

The Munich Ifo Institute sees it similarly.

The result of the shortage of materials is likely to result in further increases in construction prices.

In building construction, according to the economic research institute, 31.3 percent of construction companies complained about delivery problems in December.

That was a little less than in November (34.5 percent), but in a long-term comparison it is still a very high number.

In civil engineering, the situation is somewhat better: 23.1 percent of the companies reported a lack of supplies, after 28.7 percent in November.

"Despite the current improvements, the situation remains tense. In a long-term comparison, the values ​​are still exceptionally high," said Ifo specialist

Felix Leiss

.

A reduction in VAT is another price driver

In addition to the increased material costs, the withdrawal of the temporary VAT cut also drove prices up in November compared to the previous year. The regular rates have been in effect again since January 2021, so goods and services have tended to be more expensive year-on-year. Without the VAT effect, according to statisticians, construction prices would still have risen arithmetically by 11.6 percent in November 2021.

The industry expects good business despite the stresses caused by material shortages.

In view of the full order books, the Central Association of the German Construction Industry and the Main Association of the German Construction Industry recently saw scope for a nominal increase in sales of around 5.5 percent to 151 billion euros in the construction industry this year.

Taking into account the price increase, there is real growth of 1.5 percent.

For the past year, a slight increase in sales of nominally 0.5 percent to 143.5 billion euros is expected.

In October 2021, sales in the main construction trade rose by 3.4 percent compared to the same month of the previous year, according to the Federal Office.

In the first ten months, revenues were nominally 1.0 percent higher.

sio / dpa

Source: spiegel

All news articles on 2022-01-10

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