(new: more details and background)

WIESBADEN/MUNICH (dpa-AFX) - The downward trend in building permits for apartments in Germany has continued rapidly. In November, the construction of 24,304 apartments was approved, a good 16 percent less than in the same period last year, the Federal Statistical Office reported on Wednesday. For the already faltering new construction in Germany, this is a bad sign. Building permits are an important indicator in view of the housing shortage in many cities. The Ifo Institute warned of a gloom in residential construction.

According to the Wiesbaden-based statisticians, 321,757 dwellings were approved between January and November, a drop of 5.7 percent compared with the same period last year. The decline was particularly sharp for single-family homes (minus 15.9 percent).

In view of higher interest rates and more expensive materials, residential construction in Germany is faltering. Many builders are holding back or canceling projects. Prices for new construction of conventionally manufactured residential buildings rose by almost 17 percent in November. Federal Construction Minister Klara Geywitz (SPD) had conceded that the traffic light coalition will miss its target of 400,000 new homes a year. With the strong immigration, especially of refugees from Ukraine, the demand for housing is also increasing.

New residential construction in Germany is coming under increasing pressure, the Munich-based Ifo Institute also noted on Wednesday. In December, it said, orders on hand fell for the fifth month in a row. "The main reasons include the significantly more expensive housing loans, sharply increased construction costs and the reduction of the federal government's subsidy for new construction," Ifo expert Ludwig Dorffmeister said. "For private builders and housing companies, the general conditions have deteriorated drastically." However, he added, this will only have a limited impact on construction for the time being because of the long implementation times.

The Central Association of the German Construction Industry (ZDB) expects around 245,000 homes to be completed in 2023. On Wednesday, it called for, among other things, a reduction in land transfer tax and an expansion of special depreciation allowances in new social housing construction. The German Construction Industry Federation (HDB) also lowered its forecast for residential construction. It now expects 250,000 apartments to be completed this year, 25,000 fewer than previously expected.

An alliance of tenants' associations, construction unions and social and industry associations had recently already warned of a worsening housing shortage. There is a shortage of around 700,000 homes in Germany, Tenants' Association President Lukas Siebenkotten had said.

The Federal Association of Free Real Estate and Housing Companies warned that we are only at the beginning of a rapid decline. It said the building permit was a look at the past, "the applications were made many months before, well before the current crisis." The deputy chairman of the CDU/CSU parliamentary group for housing and construction, Ulrich Lange, criticized that with the renewed decline in building permits, the goals of the federal government were receding into the distance./als/DP/jha