According to the Ifo Institute, the real estate market in #residential construction continues to head for a severe crisis. According to the latest survey, more than 18.9 per cent of construction companies in the residential construction sector complained about cancellations of scheduled projects in July 2023. In the previous month of June 2023, the figure was 19.2 per cent. Compared to the long-term average of 3.1 percent, these are drastic figures.

High interest rates coupled with high material and #construction costs are to blame for the development. New business is strangled under these conditions.

In July 2023, more than 40 percent of construction companies in the residential construction sector complained about a lack of orders. That is one in four out of ten companies. In June 2023, it was already around 34.5 percent. Compared to the previous year, this percentage has roughly quadrupled.

While many companies are still drawing on order backlogs from better times, every tenth company is now already in crisis mode. In the current survey, 10.5 percent of the companies say they are already experiencing financing difficulties.

According to the survey, companies in the residential construction sector are extraordinarily pessimistic about their business prospects, scoring minus 51 points.

With a focus on the politically set goal of meeting the high demand for affordable housing in particular, the framework conditions must be readjusted by politicians. Otherwise, housing construction will be in free fall within a very short time.