Building permits for apartments collapse by almost a third

Berlin The crisis in German residential construction threatens to worsen further: the number of building permits fell in April, the sharpest since March 2006 due to higher interest and material costs. Only 21,200 apartments were approved and thus 31.9 percent or 9900 fewer than a year earlier, as the Federal Statistical Office announced on Friday. The number has been falling continuously since May 2022.

“The decline in construction projects is likely to have been mainly due to high costs for building materials and increasingly poor financing conditions,” the statisticians explained the downward trend.

After eight interest rate increases in a row by the European Central Bank (ECB) to currently 4.00 percent, building loans have become noticeably more expensive. The currency watchdogs want to use it to fight inflation. From January to April, a total of 89,900 building permits were issued for apartments, which was 27.3 percent fewer than in the same period last year.