Building in Germany remains expensive. In particular, prices for mineral building materials such as cement, lime and gypsum rose sharply in the first half of the year. There is some relief in the price of wood.
The prices for various building materials rose massively in the first six months of the year. This means that new construction projects remain expensive for house builders and also housing associations.
High prices, fewer construction projects
“The prices for building materials will remain high in the first half of 2023,” the Federal Statistical Office summarized current statistics. The experts point to the significant decline in construction projects in Germany, which is also due to the increased prices for building materials.
Mineral building materials such as cement and building sand in particular rose significantly in price, namely by 41.7 percent and 22.7 percent compared to the same period last year. The prices for lime and gypsum (plus 67.7 percent) were also well above the level of the first half of 2021. Building materials that also require a lot of energy to produce – for example flat glass, for windows – rose by 45% in price during this period .4 percent.
Wood is sometimes cheaper
However, there were also price declines for various construction materials in the first half of the year. The statistics show falling prices for building materials made of wood: so-called solid structural wood (minus 28.0 percent) and roof battens (minus 25.3 percent) fell in price in the first six months of this year compared to the same six months last year.
Despite high energy costs during production, some steel products used in construction also became cheaper: according to calculations by the Federal Office, reinforcing steel in bars cost 28.5 percent less than in the first half of 2022, and reinforcing steel mesh cost 27.1 percent less. In contrast, the prices for metal building materials rose by around a third (31.6 percent).
Significantly more expensive than before the energy crisis
According to the statisticians, almost all building materials remained more expensive than before the energy crisis: “Despite the partly falling prices for individual building materials, the price level in the first half of 2023 for almost all building materials was above the level before the energy crisis.”
The increased prices for materials as well as the higher interest rates are slowing down construction activity in Germany. Real estate and construction associations assume that the federal government’s target of 400,000 new apartments annually will clearly be missed this year. The Federal Statistical Office reported a decline in building permits for apartments, single-family homes and multi-family houses of around a third for the months January to July compared to the same period last year. At the same time, many construction projects were canceled.