The Construction Industry Faces a Challenge: In 2023, The Fewest Building Permits Were Issued in Germany Since 2012. Private Individuals in Particular Applied for Fewer Building Permits, Which Could Potentially Lead to a Shortage of Living Space and Higher Costs for Building Materials. Companies and Public Authorities are also Affected by the Decline.

The number of approved construction projects is an important early indicator of future construction activity, as they represent planned construction projects. The construction industry therefore warns of potential job losses and an increasing shortage of housing and calls for more support from the federal and state governments.

The decline has been particularly noticeable in building applications from private individuals. Compared to the previous year, there was a 42.2 percent decrease in the number of building applications submitted. There were also significant losses for companies and public sector bodies, amounting to 20.3 percent and 12.1 percent, respectively. The permits for single-family homes (down 39.1 percent) and two-family homes (down 48.3 percent) saw particularly steep declines. There was also a 25 percent decrease in newly planned apartments in multi-family homes.

The trend was also evident in non-residential buildings such as offices, warehouses, and factories. Here, the approved enclosed space decreased by 15.7 percent compared to the previous year to the lowest level since 2015 - another alarming sign for the construction industry.

Dirk Salewski, President of the Federal Association of Independent Real Estate and Housing Companies, sees the construction industry in a difficult position and talks of disaster scenarios from the last year being exceeded. He also emphasizes that construction projects often cannot be realized despite having been granted building permissions. He criticizes the federal government for not responding sufficiently to the situation.

Felix Pakleppa, Chief Executive of the Central Association of the German Construction Industry, Warns of a Massive Housing Crisis in Germany and Urgently Calls for Measures. As a First Step, the Existing Growth Opportunities Act Must Be Passed, Which Includes Tax Advantages for Rental Housing Construction. However, the Law is Currently Being Blocked by the States Led by the Union in the Federal Council.

The situation of the construction industry in Germany is worrying. There is the risk of job losses, housing shortages, and rising costs. The calls for support from the federal and state governments are becoming increasingly loud. However, whether this will be sufficient to stop the decline in building permits remains to be seen.