While many people are looking for affordable housing, especially in cities, the number of newly built apartments fell slightly last year. The federal government is clearly missing its target.
Slightly fewer new apartments were built last year than in the previous year. 294,400 apartments were completed, 0.3 percent less than in 2022, like that Federal Statistical Office The number of apartments completed each year has therefore hardly changed since 2021. The majority of the new apartments were new buildings.
The federal government has clearly missed its target of 400,000 new apartments annually by 2023. However, given the difficult conditions for construction projects, the result was better than feared.
Construction projects have become significantly more expensive in the past two years due to the sharp rise in loan interest rates and construction costs. As a result, many projects have been postponed or canceled, particularly in housing construction.
Federal Construction Minister Klaras Geywitz described the situation in the construction sector as stable. In addition to the 294,400 completed apartments, a further 390,900 apartments are currently under construction. In addition, there was a significant increase in approvals for social housing in 2023. The number of subsidized housing units rose by more than 20 percent to a total of 49,430.
Fewer Building permits than in the previous year
The number of building permits fell last year. A total of 259,600 permits were issued – 26.7 percent fewer than in the previous year. The number of building permits is therefore lower than the number of completed apartments. This is due to permits that have already been approved in previous years. The number of approved but not yet completed apartments has fallen to almost 830,000 apartments, marking the first year-on-year decline since 2008.
The Main Association of the German Construction Industry explained that many of the completions of the previous year can still be attributed to permits that were applied for and granted under significantly better conditions in the years up to 2022. “The bottom line, however, remains: In the previous year, fewer apartments were built than the need for affordable living space actually required,” said Managing Director Tim-Oliver Müller.