Thuringia: A Sharp Decline in Housing Construction
Introduction
Thuringia, a state in central Germany, has witnessed a drastic downturn in its residential construction sector. According to statistics released by the State Statistical Office in Erfurt, the number of building permits issued for new apartments plummeted by nearly half in 2024 compared to the previous year.
Sharp Decline in Building Permits
In 2024, only 1,256 building permits were granted for new apartments, representing a 44.7% decrease from the already weak figure of 2,270 in 2023. This marks the second consecutive year of a substantial decline, with a 50% drop in construction permits recorded in 2023 compared to 2022.
Regional Variations
The decline in housing construction was not uniform across Thuringia. The district of Eichsfeld recorded the highest number of housing projects (130), followed by Erfurt (127), Gotha (112), and Hildburghausen (106). Conversely, the districts of Sonneberg and Kyffhäuserkreis saw the fewest new construction projects, with only 19 and 17 building permits issued, respectively.
Breakdown of Housing Types
Of the 1,256 new housing units approved for construction, single-family homes accounted for the largest share (46% or 574 units), albeit with a 22.4% decline compared to 2023. The number of approved projects for two-family homes also declined by 30.3% to 92 units.
The most significant decline was observed in multi-story buildings, which typically house rental and condominium apartments. Only 493 permits were issued for such units, representing a sharp drop of 56.7% or 645 units compared to 2023.
Impact on the Construction Industry
The downturn in housing construction has had a significant impact on Thuringia’s construction industry, which employs approximately 25,000 workers. Despite the challenges, the Construction Industry Association of Thuringia is committed to preserving jobs by promoting infrastructure investments and construction projects in other sectors such as industry, commerce, and transportation.
Factors Contributing to the Decline
The Construction Industry Association attributes the decline in housing construction to several factors, including:
- High construction costs, with per-square-meter expenses ranging from 3,800 to 4,200 euros.
- A shortage of affordable building land.
- The impact of the COVID-19 pandemic and supply chain disruptions.
Outlook for the Future
According to industry experts, Thuringia is unlikely to experience a rapid recovery in its housing construction sector. Investors remain hesitant to initiate new projects due to the high costs involved. The relatively low demand for housing, particularly in rural areas, further exacerbates the situation.
