Construction costs are currently skyrocketing

2023-02-12 00:22:17

I also see that there is clearly more interest in the customer in our area again. Construction companies are updating their websites (which have been just a static image for 5 years) with information and references. The customer will soon be king again. Because these prices are no longer affordable for many. With us, the offer to buy has more than doubled while rental properties are quickly sold out and the supply there has halved. Conclusion: Prices remain this high, but it won't get more expensive, and due to wage increases in the coming years, new construction will be affordable again in 5 years. Because when demand decreases, prices also go down in a market economy.

2023-02-12 06:22:18

Sunshine, where does your optimism come from that high wage increases do not lead to price increases? Especially since you have an insane gap between labor costs and net wages.

2023-02-12 12:38:56

Optimism is always important. Assuming wages increase by 8%. This also applies to the construction industry, but it will not be possible to raise prices there. Because if 3000€ per m2 is now standard, almost no one can afford that. There will be competition among the general contractors again, and they will have to partly sacrifice their margin. Because with the collapse in building permits, not all general contractors will be able to stay in the market. The result will, of course, be a price war for customers. Building will not become more expensive. We will remain at the high level, which will eventually normalize due to wage increases. A silly example is Tesla. They are also lowering their electric car prices by up to 9000€ in times of high inflation. Why? Because otherwise no one buys the cars anymore, and a fully utilized factory is better than selling only a few. The masses make the difference.

2023-02-12 14:49:12

Optimism is always important. Assuming wages rise by 8%. That also applies to the construction industry, but it will not be possible to raise prices there. Because if €3000 per square meter is standard now, then hardly anyone can afford that. There will be competition again among the general contractors, and they will have to forgo a margin to some extent. Because with the collapse of building permits, not all GCs will be able to stay on the market. The consequence will of course be a price war for customers. It will not become more expensive to build. We remain at the high level, which will eventually normalize due to wage increases. A stupid example is Tesla. They are also lowering their electric car prices by up to €9000 in times of high inflation. Why? Because otherwise no one buys the cars anymore, and a fully utilized factory is better than selling only a little. The mass makes the difference.

Especially since profit margins have been significantly increased in recent years, so reserves are now available to be reduced again. What the master craftsmen with their own companies have pocketed here in recent years was really crazy. They just milked the cow as long as it gave milk.

2023-02-12 15:31:52

An industry that has been overheated for years is cooling down a bit … I don’t see a drama in that

2023-02-12 19:49:57

I cannot yet imagine that there will be such widespread wage increases.

Construction costs are currently skyrocketing

Sunshine387

haydee

Sunshine387

chand1986

guckuck2

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