Real estate construction prices in Germany are rising faster than they have been in 51 years

Real estate construction prices in Germany are rising faster than they have been in 51 years

Real estate construction prices in Germany are rising faster than they have been in 51 years
The prices for the new construction of conventionally manufactured residential buildings rose by 12.6 percent.  Source: dpa

The construction of new apartments in August became more expensive than it has been since 1970. The prices for the new construction of conventionally manufactured residential buildings were 12.6 percent above the level of the same month last year, as the Federal Statistical Office announced on Thursday in Wiesbaden. According to the information, a stronger increase was last measured in November 1970 with 13.1 percent compared to the same month of the previous year.

Currently, among other things, is driving up prices on the world markets. Carpentry and timber construction rose in price above average in August. Due to the increased demand for construction timber at home and abroad, prices rose by 46.5 percent compared to the same month last year.

In addition, the withdrawal of the temporary VAT cut is now having a full impact. In order to stimulate consumption in the corona crisis, the federal government had temporarily reduced VAT from July 1, 2020 to December 31, 2020.

The regular VAT rates have been in effect again since January 2021, so goods and services tend to be expensive. Without the value-added tax effect, the construction prices would have risen arithmetically by 9.7 percent.