The Inquiry

The German government was elected with a plan to build 400,000 new homes a year – but it fell short last year by over 100,000. The country’s house building industry is in crisis, with hundreds of companies going into liquidation this year as order books are emptying and demand for new homes has fallen. So why can’t Germany build enough homes? A combination of high construction costs caused by inflation since the Covid pandemic, and increases in interest rates in recent years has produced a difficult business environment for a construction sector that is a significant part of the German economy. Along with falling demand, industry experts fear that regulations and bureaucracy are a factor in causing the crisis. Charmaine Cozier hears from: Dirk Salewski President of the German Housebuilding Federation who attended a recent summit hosted by Chancellor Olaf Scholz when the government announced a 14 point plan to revive housing construction. Alice Pitinni is the research director at Housing Europe, the Euro