Ulrich Caspar describes the current situation of the construction and real estate industry as "worrying". The President of the Frankfurt Chamber of Industry and Commerce (IHK) refers to a survey at the beginning of the year. Accordingly, the majority of companies in the industry expect a negative development. According to Caspar, the economic environment is becoming a "brake factor" for housing construction.
Günter Murr
Editor at the Rhein-Main-Zeitung.
- Follow I follow
In the housing market report of the IHK real estate exchange, there is talk of a significant slump in the fourth quarter of 2022. Interest in buying real estate has fallen significantly, with demand falling by up to 80 percent in some segments. This has an impact on prices. They have fallen by up to five percent, says broker Helmut Christmann, CEO of the real estate exchange. This also corresponds to the findings of the Federal Statistical Office, which has determined a price decline of an average of 2022.3 percent for the fourth quarter of 6.
Reluctance to buy continues
Apparently, the ideas of sellers and buyers must first converge again under changed conditions. Christmann notes that apartments and houses are not sold at the price at which they were offered in the real estate portals. "The situation was different with new buildings," says Christmann. Because of the increase in construction costs, there were no price reductions here. "The reluctance to buy seems to continue this year." The experts of the real estate exchange also expect stagnating or falling purchase prices for 2023.
According to Christmann's assessment, prospective buyers are nevertheless increasingly switching to the rental housing market due to the rise in interest rates. The result is a further aggravation of the situation on the rental market. Rents have risen, especially in popular locations in Frankfurt and in new construction projects, but only moderately.
For the housing market report, the experts in the real estate exchange evaluated purchase prices and the rents agreed in new contracts in the entire chamber district, which includes the Hochtaunuskreis and the Main-Taunus-Kreis (without Hochheim) in addition to Frankfurt. In addition to the spread between the lowest and highest values, a focus is mentioned, i.e. the price that is typically achieved most frequently. The spread is particularly large in Frankfurt. While in popular locations such as the West and the Nordend apartments are sometimes sold for more than 10,000 euros per square meter, the lower limit is 2200 euros in the Riederwald and Fechenheim. The principle "the more central, the more expensive" also applies to rents. Peak values of 24 euros per square metre are shown for the Westend. On the other hand, apartments in the west of Frankfurt are still available for 7.50 euros.
This corresponds to the level of some Taunus communities. Here, too, the principle of centrality applies: the closer to Frankfurt, the more expensive. Bargains are mainly available in the Hintertaunus, i.e. in communities such as Grävenwiesbach or Weilrod. Maximum values of around 7000 euros per square metre, on the other hand, are achieved in popular streets in Bad Homburg or Bad Soden. The prices for terraced houses and small semi-detached houses have hardly changed, according to the experts. The supply in this segment has fallen sharply.
"Municipalities should increasingly designate building land"
An easing is not expected for 2023: "The sum of the current economic and economic challenges will be the brake factor for further new construction activities in the region," according to the housing market report. "In order to relieve the housing market for skilled workers and workers, the municipalities should increasingly designate building land," demands IHK President Caspar. Barriers to investment would also have to be removed by reviewing, reducing or repealing building regulations and municipal statutes. The housing market does not tolerate any further interventions.
The Association of Hessian Business Associations (VhU) also sees state politics as having a duty. "Without decisive action by the state government, the housing shortage in Hesse will continue to worsen," says Vice President Thomas Reimann. Cost-driving building regulations and lengthy planning and approval procedures would also have to be tackled. "We have to build cheaper and faster," says Reimann.
The complete housing market report can be downloaded at www.frankfurt-main.ihk.de/wohnungsmarktbericht.