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last mo.

German Housing Permits Jump in Q1 as Recovery Shows Strain

Higher borrowing costs now put the rebound at risk.

Bauarbeiter auf einer Grossbaustelle in München.
Auch im März ist die Zahl der Baugenehmigungen in Deutschland weiter gestiegen. Es wurden 21.800 neue Wohnungen in neuen und bestehenden Gebäuden genehmigt - 11,5 Prozent mehr als im Vorjahresmonat, wie das Statistische Bundesamt mitteilte.
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Overview

  • Destatis, which published the figures Monday, said March approvals rose 11.5% to 21,800 and the first quarter reached 63,500, up 14.6% year on year.
  • The gains were broad, with new single-family homes up 13.7%, two-family homes up 23.2%, apartments in multi-family buildings up 14.9%, and conversions up 12.3%.
  • Economists caution that the Iran war has pushed up ten-year mortgage rates by about 0.3 percentage points since early March, raising financing and material costs.
  • Business sentiment in construction slumped in April as the ifo climate index fell from −19.3 to −28.4, and 9.2% of firms reported shortages of basic materials such as steel, concrete, and insulation.
  • Industry leaders say approvals still fall short of demand by roughly 10,000 per month, which means tight housing supply and high rents are unlikely to ease soon.