Cancellations in German Residential Construction on the Rise Again
Cancellations are growing in number in German residential construction, finds an ifo Institute survey. In November, 16.7 percent of the companies surveyed were affected, up from 14.5 percent in the previous month. “Companies still have well-filled order books. But constantly climbing construction prices, higher interest rates, and fewer subsidy options are weighing on new business. For several months now, these factors have led to a conspicuous number of cancellations, and companies are very concerned,” says ifo researcher Felix Leiss.
Business expectations for the next six months clouded over once again. At minus 60.9 points, they set a new negative record – the lowest figure since the survey began in 1991. “The business outlook for residential construction appears bleak, with a majority of companies fearing declines in the coming six months,” Leiss says. Price plans fell only slightly, from 51.0 points to a still very high 45.4 points. “Despite already weakened demand, many businesses are having to opt for further price increases to pass on high material and fuel costs to customers. Construction prices are still rising,” Leiss says.
