Investment by the construction industry on the rise in the first quarter of 2007

The situation in the construction industry has been further improving since the beginning of this year. According to the Federal Statistical Office, the adjusted-for-price figure for investment by the construction industry rose by 15.3% in the first quarter of 2007 as compared to the first quarter of 2006. The figure adjusted for season reflected a plus of 3.5%. At the same time the prices for new constructions also increased significantly and were up by 6.8% as compared to the same period in 2006.

A particular important effect on the strong increase of investment in construction resulted from the favourable weather conditions so far this year which led to virtually no limitations on construction activities. This had a particularly positive effect on civil engineering: the business in public civil engineering increased by 37.5% adjusted for price as compared to 2006, while the business in the private civil engineering sector was up by 20.5%.

Investment in structural engineering increased significantly too: in the private house building sector activities were up by 14.2% in figures adjusted for price as compared to the first quarter last year. In public structural engineering and industrial structural engineering the increases amounted to 16.2% and 11.4% respectively.

Prices for new constructions also further increased. In the first quarter of 2007 prices were up by 6.8% compared to the first quarter in 2006, while this strong increase was partly due to the VAT increase in Germany. The last such similarly strong increase in prices had taken place back in the year 1992 as a consequence of a construction boom in the wake of German re-unification. GERMAN