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New building in Berlin: Record investments cannot break stagnation!
Investments in Berlin housing construction are reaching record levels, while new construction projects will stagnate in 2025. Causes and perspectives.
New building in Berlin: Record investments cannot break stagnation!
In Berlin there is an ambivalent picture on the housing market: despite considerable investments, new construction is stagnating. According to the latest information from rbb24 Housing companies in the capital are investing record sums, but the forecasts for 2025 only indicate around 5,300 newly completed apartments. This corresponds to the level of the previous year and is drastically less than in 2022.
The Association of Berlin and Brandenburg Housing Companies (BBU) signals that the companies want to invest almost 3.9 billion euros in the coming year. This represents an increase of around a third compared to 2024, with over 40 percent of the money expected to flow into the new building. Similar observations are also made Daily Mirror, which addresses the stagnating progress in the new construction process and makes it clear that the high costs and the lack of skilled workers are severely slowing down the construction of new apartments.
Hurdles and challenges
The challenges are diverse. The construction costs, which fell by a third last year compared to previous years, are contributing to the misery. At the same time, prices for apartments and new construction rose by around 50 percent. These price increases reduce the chances of success of the investments, as BBU board member Maren Kern notes. Numerous measures to improve the situation are very popular, including the newly initiated Faster Building Act and the ongoing administrative reform in Berlin.
In order to make progress, the BBU is calling for more planning security and freedom for housing companies. The persistently high costs of materials and services are another reason why new construction is currently stalled.
Market analysis and rental price development
The picture in the surrounding area is also tense, as rents here have risen by 6.3 percent, with Potsdam leading the way at EUR 11.91/m². Over the last eleven years, the median rental price in Berlin has increased surprisingly sharply - by over 60 percent. In this context, it is clear that efforts to create new housing are not only urgent but also essential to meet the growing needs of the population.
Overall, it remains to be seen whether the announced measures will be enough to actually drive forward housing construction in the capital. The next few months will show how construction activity is going in Berlin and whether the investments can bear fruit.