A strong labour market and low interest rates have helped drive growth in the German economy. The housing sector experienced strong growth during 2016, especially in metropolitan areas in the south and west of the country, fuelled by low interest rates and steady demand growth. Construction costs increased only modestly.
The growth rate in the German construction sector was between 5 percent and 6 percent in 2016 with a turnover of approximately EUR106.5bn.
Residential construction was the strongest market-driver. Demand for commercial offices dried up as the market become oversupplied. Government spending on infrastructure projects remained relatively flat in recent years.
Further growth triggers will come from social transformation, including the demographic change and the refugee policy. Fast and intense changes in the technical field will also drive refurbishments and energy-efficiency projects.
Germany is completing a number of large infrastructure projects over the next ten years, such as the building of a new terminal at Frankfurt airport, and the construction
of Stuttgart 21, a rail and urban centre. A second main line of the Munich metro-rail and a medical campus at the University of Augsburg are also under construction.
In Berlin, the reconstruction of the original Humboldtforum, a baroque palace that will serve as an art and exhibition gallery, is underway.