Cloudy outlook – first companies are reporting financing problems

Dusseldorf Rising interest rates and ongoing shortages of materials are weighing on the construction industry and making for a pessimistic view of the future. The wave of cancellations in building construction is declining a little, as the Munich Ifo Institute announced on Monday in a survey. In October, 11.3 percent of companies said they were affected, up from 13.2 percent in September.

Ifo researcher Felix Leiss says at the same time: “In view of the often hardly calculable construction costs and rapidly rising interest rates, many builders throw in the towel, they postpone projects or cancel them completely.” There are order cancellations, especially in residential construction. “But commercial building construction is also struggling with cancellations.”

The situation is already becoming threatening for the first companies, Leiss continues: “6.6 percent of building construction companies are reporting financing difficulties.” In October 2021, the proportion was only 0.6 percent.