The building industry is booming, not only in Germany, but across the whole of Europe. According to forecasts by the EUROCONSTRUCT Group it will grow in 2018 by an average of 2.6 percent. Demand has risen in all 19 member countries of the EUROCONSTRUCT network for the second year running.
The European building sector has been on a growth trajectory since 2014. Construction output in the four years from 2014 to 2017 increased by 9% overall, to a total of EUR 1.50 trillion. Last year alone growth in the EUROCONSTRUCT region was 3.50%. Again the strongest impetus came from the housing sector.
A further increase of 6% can be expected in the 19 EUROCONSTRUCT member states by 2020. However, growth rates will slow considerably in the future in both residential construction and non-residential construction—the new-build segment in particular will noticeably lose pace by 2020. In 2016 and 2017 the increases here were still as much as 6%. In future civil engineering is expected to take over the role of
market driver. The latter will see increases in the years 2018 and 2019 of over 4%, a figure not seen since the 1990s.
One of the most important drivers behind the current upwards trend is the robust economic development of Europe. Other factors are low interest rates, immigration and internal migration flows, as well as the investment backlog in infrastructure that has accumulated in many places since the financial crisis and also more consistent use of European funding.
While on the one hand construction activity is continuing on a growth path in economically stable countries like Poland, Norway and Germany, the recovery is continuing in the building sector in those countries that saw slumps in recent years. These include countries like Ireland, Spain and Portugal, but also France, Italy and Hungary.
In Germany construction activity rose in 2017 by 2.6%, which was stronger than in 2016. The growth was driven by higher demand for residential accommodation, a greater willingness to invest on the part of companies and a civil engineering drive by the German government. Although growth will slow down significantly in the mid-term, investment in both the residential and the infrastructure segments is expected to be high in the long term.
EUROCONSTRUCT®, the European research and consulting network, was founded in 1975. The members are institutes with specific expertise in the construction and property sector from 15 Western European countries and four in Eastern Europe. The core of EUROCONSTRUCT’s activities are conferences at which the latest forecasts for the construction sector in the member countries are presented. These events take place twice a year at different venues in Europe. The ifo Institute is a founder member and the German partner institute of the network. Further information:
Trend in building demand in the EUROCONSRUCT area, according to segment
♦ Civil engineering