Starting 2013 with optimism!

If the just-ended “Bau” trade fair in Munich is any indicator of the prospects for the construction industry in this new year, then we are in for a super year in the construction sector in 2013. Crowded aisles and a crush of visitors at the exhibition stands evidenced the huge interest of architects and planners in the products and services showcased by the building materials producers. Incidentally, Bau 2011 also heralded a super construction year. The 2007 trade fair, on the other hand, was also positively encouraging and yet construction activity remained on a very low level as the construction rush following the discontinuation of the home buyer allowance in Germany at the end of 2006 soon petered out.

Today preconditions for a further upswing in housing construction in Germany are still good: low interest rates, the persisting “flight” into property triggered by “euro angst” as well as media reports on a widespread housing shortage in Germany are spurring private homebuilders and commercial investors to go ahead with their construction projects. Beside newbuilds, the renovation of older buildings will probably be given a boost in the current year. At last the torturously long discussion on potential tax relief for private home builders has been ended. Unfortunately, the Bundestag and Bundesrat, Germany’s lower and upper houses of parliament, have not been able to agree on tax deductibility for investment in the energy refurbishment of buildings in advance of this year’s parliamentary elections. Instead relatively small grants are available to home builders in the scope of the KfW subsidy programme. This, in any case, has brought some legal clarity, and particularly the roofing tile manufacturers are hoping that roof refurbishment projects shelved last year will now be realized.

Problematic for our sector, especially for the producers of masonry bricks, is the fact that a large part of the increases in building permissions granted refer to the construction of apartment buildings. Here greater efforts are needed to communicate to planners and investors that clay bricks in particular – whether in monolithic or double-leaf construction – can be used to build sustainable buildings that are attractive to tenants and building owners.

In this new year, the opportunities for our industry easily outweigh the risks. Together with its smaller neighbouring countries of Austria and Switzerland, Germany is, as far as housing is concerned, almost an “island of the fortunate”. After a long period of pitifully low activity in housing construction, it is now imperative that we fill the gaps in demand now opening up. The clay brick and tile industry should do everything to take its share in this upturn.

Yours

Martin Roth

General Secretary of the Federal Association of the German Brick and Tile Industry