Overview

• The Ifo business climate index for Germany’s residential construction sector rose by almost six points in June to –25.2, marking its highest level since September 2022.
• Business expectations drove the upswing and the current assessment edged up, but both measures remain well below pre-Ukraine war norms.
• Almost 47.9 percent of surveyed housing builders continue to report insufficient orders, underscoring persistent demand gaps.
• Ifo survey head Klaus Wohlrabe cautioned that the sector needs more than announcements and that lasting recovery depends on effective government reforms.
• Financing costs for residential projects still have room to decline, which experts say could bolster building activity if paired with concrete policy action.