June 18: German Construction Industry Association Raises Growth Expectations

June 2018

The German construction industry association HDB has upgraded its 2018 industry growth expectations from 4 to 6 percent and predicts 6 percent growth looking forward into 2019. With prices increasing more than in 2017, this could indicate real-terms growth of 2%, the association stated.

Residential construction remains the main driver of the industry in Germany. The HDB expects the number of completed dwellings to rise from 330,000 to 340,000, although this still lies behind the government’s stated target of 375,000 annual completions.

The association also expects positive figures for commercial construction. HDB president Peter Hübner highlights manufacturing industries’ continued willingness to invest, strong demand for office space, broadband roll-out and investments by Germany’s national rail operator in new lines and station modernization.

Public construction was currently benefitting from federal investment in transportation infrastructure, which rose from EUR 10.3 billion in 2014 to EUR 13.4 billion in 2017, according to the report. Funds for investment are set to increase further to EUR 14.2 billion this year, according to Hübner. “Now it’s about turning these funds into projects,” he said, noting that many municipalities face an investment backlog.

Turnover in main construction trades in Germany
Turnover in main construction trades in Germany | © Hauptverband der Deutschen Bauindustrie, Umsatzprognose 2018

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