Fewer than 300,000 homes: a distant goal

Created: 05/23/2022, 13:46

According to the Federal Statistical Office, just 293,393 new apartments were completed last year.

More than 100,000 too few.

© Julian Stratenschulte/dpa

The federal government wants to build 400,000 new apartments every year in order to end the current state of emergency.

But the actual numbers are falling.

Wiesbaden - In Germany, too few apartments are still being built to eliminate the bottlenecks, especially when it comes to affordable housing.

Last year, the number of newly built apartments surprisingly fell below the 300,000 mark again, as reported by the Federal Statistical Office.

With 293,393 units completed, new construction fell short of the political goal of 400,000 new apartments per year, which was last achieved in 2000.

This ended the upward trend in completions that began in 2011.

In its coalition agreement, the incumbent federal government has set itself the goal of creating 400,000 new apartments per year.

A decline is to be expected in the future

The decline of 4.2 percent compared to the previous year is only the harbinger of a "dramatic slump in housing construction," warns the Central Association of the Housing Industry (GdW), behind which around 3,000 real estate companies with a total of 6 million apartments stand.

Real estate associations are also complaining that fewer new apartments are currently being approved than in the previous year.

In the first quarter, the previous year's result was missed by four percent.

The construction industry was also disappointed: "With around 293,400 new apartments completed last year, we fell well short of expectations and forecasts," says Felix Pakleppa, General Manager of the German Construction Industry Association (ZDB).

"Unfortunately, we have to assume that it won't be this year either."

The construction industry is also dissatisfied

Because of the Ukraine war and the global disruptions to the supply chain, there is currently a lack of pretty much everything you need for a new building: Materials are either non-existent or astronomically expensive, skilled workers are scarce and building interest rates have risen sharply in recent months.

The industry complains that there are also unclear climate requirements, funding chaos and bureaucratic obstacles.

"There is a great deal of reluctance to build," summarizes Michael Schick from the German Real Estate Association (IVD).

The reality is therefore that, according to the Wiesbaden statistics, almost 850,000 units have been approved by the authorities in Germany, but have not yet been tackled by investors.

The companies waited out of uncertainty, explains GdW President Axel Gedaschko: “In order to stop this, the government urgently needs to introduce a reliable and adequate funding system and an effective raw materials strategy for the sustainable supply of Germany’s construction sites.”

Construction minister wants to remove bureaucratic hurdles

The German state has little influence on delivery bottlenecks, raw material shortages and significant price increases, says the construction minister of the traffic light coalition, Klara Geywitz (SPD).

In cooperation with the federal states, she promises to reduce bureaucratic obstacles: "In other words, digitize approval and planning processes, harmonize the 16 state regulations in a meaningful way and ease the conditions for serial construction."

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Many experts are increasingly turning their attention to new apartments in existing buildings, i.e. adding stories to existing buildings or converting office buildings, which to date only account for around twelve percent of applications for new apartments.

The real estate association IVD sees a potential of 4.3 million new units by 2040 and calls for simpler approval procedures.

Office repurposing could save a lot of money

If offices were converted into social housing, a good 8,000 euros per apartment could be saved, calculates the chairman of IG Bauen-Agrar-Umwelt (IG BAU), Robert Feiger.

Even around 20,000 euros could be saved if the VAT for social housing was reduced from 19 to 7 percent.

The state must quickly create incentives and simplify building regulations in order to use the potential of millions of new apartments.

The social democrat Feiger is slowly getting impatient with the traffic light coalition: there is no sign of a restructuring offensive.

dpa