(MENAFN) Wolfgang Schubert Raab, the managing director of Raab Construction, reminisces about the prosperous times when his company struggled to keep up with the overwhelming demand for home construction. Looking back to 2021, Raab recalls receiving offers to build more than half of a residential complex before the first cubic meter of concrete was poured. Fast forward two years, and the single-family housing market, as described by Raab, is now in a state of "total collapse."
This drastic turnaround in fortune is not unique to Raab Construction, as construction companies across Germany experience a sharp decline in residential construction, posing a threat to Europe's largest economy. Many construction firms are grappling with financial challenges, presenting a hurdle to Chancellor Olaf Scholz's ambitious goal of constructing 400,000 new homes annually, aimed at addressing the housing cost crisis in major cities across the country.
Responding to the crisis, the federal government recently announced a collaborative effort with state legislatures to implement a set of measures aimed at expediting the homebuilding process by streamlining bureaucratic procedures. While industry representatives view this response as a positive step, there are concerns that the measures might not be robust enough and that their implementation could be too sluggish. Tim Oliver Müller, President of the German Construction Federation, expressed skepticism, stating, "Based on our previous experiences, we do not believe that these measures will be implemented quickly, as the federal structures are very complex."
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