In 2018, the number of building permits and building completions was high. The trend will continue, but still does not meet the demand in all matters.
The general trend of an extremely active construction industry will continue in 2019. The building sector is expected to record an increase in sales of six percent and a sales level of 128 billion euros. This was stated by the presidents of the Federation of the German Construction Industry and the Central Association of the German Building Industry at their joint annual press conference in the mid-December in Berlin. According to the press release, between 2017 and 2018 increases in almost all segments, including commercial and residential construction, were monitored.
Growth in residential construction
“For residential construction, we expect a sales growth of 6.5 percent in the current year. For 2019, we expect a further significant growth of 5.5 percent. This means that around 300,000 apartments were built in 2018. For the new year, we expect the construction of 315,000 to 320,000 units,” both presidents explained. However, they note that the high demand for at least 350,000 apartments is still not covered. Also, the growth relates exclusively to the multi-storey housing construction. By contrast, classic home construction is stagnating since 2017.
Positive outlook in public construction
The growth in public construction is also expected to grow further, due to the favorable conditions. A growth of five percent has been expected between 2017 and 2018, as well as a slight increase to six percent in the new year 2019. The federal, state and local governments have noticeably increased their commitment in recent years, resulting in rising investments and subsidies of 10.3 to 13.3 billion euros.
Also the construction industry labor market has optimistic prospects as in 2018 the average number of employees increased by 20,000 or 2.5 percent to 832,000. In terms of the lows in 2009, when 705,000 workers were employed, this corresponds to an increase of 20 percent. For 2019 Hübner and Quast expect a further increase of two percent to 850,000 employees.