Building permits for apartments are falling f

Dhe number of building permits for new apartments in Germany is increasing in view of Interest charges and high material costs also collapsed in September. It fell by 9.1 percent compared to the same month last year to 27,449 apartments, as the Federal Statistical Office announced on Friday. This is the fifth decline in a row, in August the minus was even 9.4 percent. From January to September, the authorities gave the go-ahead for the construction of a total of 272,054 apartments, which corresponds to a decrease of 3.7 percent or 10,366 apartments.

The negative development is another setback in the efforts of the federal government to build 400,000 apartments per year. The Ifo Institute had previously reported on a wave of cancellations building up in the industry, which is suffering from rising interest rates, high costs and ongoing shortages of materials: In October, 11.3 percent of companies said they were affected. “In view of the often almost uncalculable construction costs and rapidly rising interest rates, many builders throw in the towel, they postpone projects or cancel them entirely,” explains Ifo researcher Felix Leiss. Order cancellations are particularly common in residential construction.

Effect of the Baukindergeld

The number of building permits for single-family homes fell particularly sharply in the first nine months of 2022, falling by 15.4 percent to 61,509. “Here, however, the base effect as a result of the expiry of the Baukindergeld in the previous year must be taken into account,” according to the statisticians. It contributed to the fact that from January to March 2021 almost 7,400 more single-family homes were approved than in the first three months of 2022. Two-family homes fell by 4.5 percent to 23,124. In the case of apartment buildings, on the other hand, the number of approved apartments rose by 3.7 percent to 145,181.

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