According to the "Building Construction Forecast 2021" of the consulting firm EY Parthenon, the construction boom will flatten out somewhat for the time being in 2022 and 2023 until the construction trend recovers. The reasons for this projected trend are the effects of the Corona pandemic and the resulting economic uncertainties. Falling rental yields, the ever-increasing shortage of building land and the resulting rise in construction costs, as well as capacity bottlenecks, also provide sufficient assumptions for a flattening of momentum in construction activity.
Non-residential construction in particular is expected to recover only slowly, with the exception of logistics properties and public sector construction. In the retail sector and in the construction of hotels and restaurants, for example, construction activity is also expected to decline in the longer term.
The situation in the residential sector, on the other hand, is different. The study experts assume that growth in (multi-story) residential construction is likely to continue. However, this will not be as high as in previous years. Instead, an increase of 1.6 percent is estimated this year and 1.7 percent in the forecast years. In the largest segment, private residential construction, construction activity is only expected to increase by around one percent in the forecast years to 2023.
Source: EY Parthenon
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