German home building permits decline in February, halting recovery

[FRANKFURT] Building permits for apartments in Germany fell 2.3 per cent in February from a year earlier, statistics office data showed on Thursday (Apr 17), underscoring the fragility of the nation’s troubled property industry.

The drop is a setback following two consecutive months of increases that provided some hope of a recovery after three years of declines.

Germany’s property sector, which began to shrink in 2022, is undergoing its most severe slump in decades. Permits are an important indicator of future construction activity.

Permits dropped by 400 to just 17,900 in February, meaning Germany remains far off pace of its goals of building 400,000 apartments a year.

“We are still stuck in the bottom of the trough,” said Felix Pakleppa, head of the Central Association of the German Construction Industry.

He called on the incoming government to take “decisive action”, including tax cuts and reduced bureaucracy, to spark a turnaround. REUTERS