BERLIN, Feb. 29 (Xinhua) -- Building permits for apartments in Germany plummeted by 26.6 percent year-on-year in 2023, further exacerbating the country's housing crisis, according to preliminary figures published by the Federal Statistical Office (Destatis) on Thursday.
Only 260,100 apartments were granted building permits, the lowest number in over a decade, according to Destatis. The German government has set a target of 400,000 new homes per year.
"The lack of building permits will lead to a shortage of apartments in the coming years and heat up the market even further," Felix Pakleppa, chief executive of the German Construction Federation, said in a statement on Thursday.
Approvals for single-family and two-family homes in Germany fell particularly sharply last year, down 39.1 percent and 48.3 percent year-on-year respectively, according to Destatis.
"The rapid and sharp rise in interest rates, high construction costs and weak growth in disposable income have clouded the investment environment," Klara Geywitz, minister for housing, urban development and building, told Xinhua on Thursday.
According to the calculations by the German Property Federation, there will be a shortage of 600,000 apartments in Europe's largest economy this year, which is set to rise to as many as 830,000 by 2027.
The German government wants to invest a total of 45 billion euros (48.6 billion U.S. dollars) in publicly subsidized housing construction in the country by 2027, according to the Ministry for Housing, Urban Development and Building.
Geywitz said he believes "pessimism is out of place," as the ministry's funding programs, continued high construction backlog, more robust incoming orders and a more stable financial environment would "stabilize future construction activity."
