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German homebuilding collapse threatens wider economic damage

Wolfgang Schubert-Raab recalls when the boom times were so good that his firm could not build homes quickly enough.

“Back in 2021, before we’d even poured the first cubic metre of concrete, we’d already had offers on more than half the complex,” said the managing director of the Raab construction company. Two years on, the market for single-family dwellings is in what Schubert-Raab describes as a state of “completely collapse”.

Across Germany, homebuilders are facing such a sharp reversal in their fortunes that the downturn in residential construction is threatening to have broader repercussions across Europe’s largest economy.

Many have declared themselves insolvent, dampening Chancellor Olaf Scholz’s target of building 400,000 new homes a year to tackle a housing affordability crisis in several of the country’s largest cities.

This week, the federal government…

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