Crisis endangers residential constructions

The conflict in Ukraine has a strong impact on the construction industry, with rising electricity costs leading up to a 20% increase in prices for building materials such as steel, bricks, and tiles.

While inflation has decreased, persistent challenges remain. High prices and interest rates continue to significantly complicate the financing of new houses and apartments.

Uncertainty and unclear heating laws and subsidies contribute to a decline in demand for homes, leading to bankruptcies in the construction sector.

This interplay of factors is hindering residential construction. Bankruptcies of major real estate companies and a lack of orders also burden construction firms.

The risk of rent increases is growing, as developers and landlords may be forced to raise rents to cover costs due to increased construction prices.

Berlin, 18.09.2023