Munich (dpa / lby) – Housing companies and the real estate industry in Bavaria expect a drastic slump in housing construction next year. The reasons for this are the sharp increase in construction costs and interest, as the working group of Bavarian real estate associations announced on Thursday. “After years of upswing, we are facing a downturn in housing construction,” said Hans Maier, chairman of the working group and director of the Association of Bavarian Housing Companies.
Maier did not name any figures, but according to the working group, builders and housing companies are currently shelving many projects – new construction projects as well as the modernization of existing apartments. “It’s just not worth building anymore,” said Maier. According to Maier, the interest rates for ten-year standard loans alone have almost quintupled this year from 0.7 to the current 3.3 percent.
The working group called for a remedy from the federal and state governments, including the rapid provision of both plots of land ready for construction and areas already developed on which new apartments could be built. The housing and real estate associations are demanding that the VAT rate for the construction of rental apartments should be reduced to 7 percent.
In addition to the Association of Housing Companies, members of the working group include the Real Estate Association Germany South and the House Owners Association
