More apartments are being built again in Germany. In the first two months of this year, 41,700 new apartments were approved. This is an increase of 16.2 percent compared to the same period last year, the company said Federal Statistical Office with. In February alone, the number of permits grew by 24.1 percent to 22,200. Of these, 19,000 apartments could be built in new buildings, while the rest are planned in existing buildings.
The number of building permits is an important early indicator of future construction activity and is therefore also important in view of the lack of living space in many metropolitan areas. There was already an upward trend in 2025 as a whole, with an increase to a total of 238,500 approved apartments being recorded for the first time since 2021, which was eleven percent more than in the previous year.
In recent years we have had, above all, high interest rates and expensive building materials Many construction projects were slowed down. The construction industry is now hoping for a continuation of the positive trend in housing construction, but at the same time points to dangers from the Iran war. Since the start of the war, energy and raw materials have become more expensive, which could make building more expensive again. There is also concern that interest rates will continue to rise. That would make loans more expensive and discourage many people from building a house.
The German construction industry had shown “robust dynamics” immediately before the start of the Iran war, said the scientific director of the Institute for Macroeconomics and Economic Research (IMK) of the Hans Böckler Foundation, Sebastian Dullien. Unfortunately, the data is “just a look in the rearview mirror.”
Concerns about rising interest rates are weighing on the business climate
More building permits did not automatically mean more construction activityalso warned the main association of the German construction industry. »Many builders are taking advantage of the opportunity to finally obtain approval. “However, high costs, requirements and bureaucracy continue to stand in the way of actually starting construction,” said Managing Director Tim-Oliver Müller, describing the situation. The federal government must therefore launch another “construction turbo”, particularly on financing issues.
According to the Ifo Institute, the mood in housing construction worsened in March. “Concerns about rising interest rates are weighing on expectations in housing construction,” said the head of the Ifo surveys, Klaus Wohlrabe. Higher financing costs would dampen the ambitions of many households when building houses.