ᐅ Is the construction boom still ongoing?

Ypsi aus NI schrieb:

@Pinkiponk
How are things with you? Have you already moved in?
Can you imagine selling your house and buying another one in your area?

We moved in three weeks ago, and we like it here. We’re a bit older ;-) but not old enough to give up on my husband’s dream of renovating a farmhouse or a three-sided farmstead. :-) So, moving after moving. :-) But for now, we’re enjoying our new home; we feel comfortable here, and the neighbors are great.

We are currently in the process of buying a plot of land and will then monitor how interest rates, construction costs, and subsidies develop. According to our house bank, almost no financing is being approved for new builds at the moment. Our planned general contractor says they will be busy until next summer, but after that, the outlook is not good. Here in this small town, the changes are definitely noticeable. In larger cities, the situation may be different.

Statements from a general contractor (GC), especially those from the salesperson or even the owner, should always be taken with caution—unless you know them well and for a long time.

Neither interest rates nor building material prices will decrease significantly in the short term. Looking ahead 2-3 years, costs will likely only increase; price drops are hardly possible. This is mainly because many GCs need to recover losses caused by sharply rising prices and fixed-price contracts from 2021/22.

P.S.:
Oh, and the rising energy costs will increasingly affect prices the longer the crisis lasts. Craftsmen do not pass this on all at once but gradually.

xMisterDx schrieb:

Statements from a general contractor (GC), especially from the salesperson or even the owner, should always be taken with caution—unless you know them personally and well over a long time.

Neither interest rates nor building material prices will drop significantly in the short term. Over a period of 2–3 years, prices are likely to only increase; substantial decreases are hardly possible.
This is partly because many GCs need to recover their losses that occurred due to sharply rising prices and fixed-price contracts in 2021/22.

PS:
Oh, and rising energy costs will increasingly be reflected in prices the longer the crisis lasts. Tradespeople do not pass on these increases all at once, but gradually.

I agree with you, though I assess GC statements somewhat differently. Nevertheless, it is simply a fact that construction activity in the private sector is declining significantly. This is evident both from my private and professional network, as well as from the development areas around us being marketed and built much more slowly.

Rechtsfuß schrieb:

I agree with you, although I have a slightly different assessment of the general contractor's statements. Nonetheless, it is simply a fact that construction activity in the private sector is significantly declining. This is evident from both my private and professional circles, as well as from the residential developments in the area, which are being marketed and built with noticeable delays.

Definitely. However, this is also because the shock from rising interest rates and inflation needs to be absorbed first.
When I received a sharp price increase earlier this year, I also had to take a moment to consider whether we should pause or even cancel the building project.

But as mentioned, there is no sign that prices will become substantially lower in the short term, meaning within 2-3 years. The key interest rate is being raised and is expected to stay at that level for some time, just as energy costs will not return to 2019 levels in the long run.

Waiting now could ultimately turn out to be a trap. The likelihood of that is not small.

BackSteinGotik schrieb:

Are the 32 building plots already allocated? That’s the key question number one – who has or will have enough money to at least secure the land? Although the allocation follows "strict" criteria, financial affordability has not been part of it so far. A single parent builder caring for three children naturally has priority according to the points system, but this only counts to a limited extent with the bank. Point number two – buying and hoping for better times – the dream could fade next year or the year after, as interest rates rise and costs may not necessarily decrease at the same rate.

No, they have not been officially allocated yet, since the formal process is only just starting. But unofficially, all the plots are already taken and the waiting list is extremely long.