Snappy Response from Saxon Craftsmen on Construction Crisis: Simplify, Streamline, and Speed Up!
- *
Reduced Regulation Desired for Saxon Craft Trade Industry - Consultation held on proposed legislation safeguarding labor from radiation hazards.
The Saxon craft sector is sounding the alarm for a quicker approval process and less red tape in the midst of the construction industry's troubles. In the words of Uwe Nostitz, President of the Saxon Craftsmen's Association, "The crisis is still marked by a paucity of orders, exorbitant costs, and thus, sky-high construction prices" – a sentiment echoed in Dresden. To address the crippling housing shortage, a revival of the construction sector is a must.
But it's not all about public funds. The crux of the matter lies in speed and reduced regulations, declares Nostitz. The solution? Simpler construction processes, fewer bureaucratic hurdles, more incentives, and residential development efficiency. The blueprint for success is in swiftening planning and approval procedures. A word of warning from the Craftsmen's Association: Avoid adding to construction costs with more regulations, instead streamline and speed up the construction processes.
A worrisome downward trend in approvals and revenue
In the Free State, over 10,000 new apartments were approved annually from 2018 to 2022. However, since then, the trend dipped: 8,872 in 2023 and a mere 7,133 in 2024. Similarly, the number of buildings approved for public and commercial use dropped – from around 1,500 yearly up to 2021 to just over 1,000 in the past year. As a result, turnover growth plummeted from around 21 percent to a measly 3 percent, despite the escalating construction prices.
Expectations for federal and state policymakers
At the federal level, the Craftsmen's Association demands predictable, manageable grants, tax relief, and, above all, less bureaucracy for both clients and contractors. "For starters, a lower real estate transfer tax and property tax exemption could provide potential builders with enticing incentives." Craftsmen are also calling for respite from stringent regulations on energy-efficient construction and renovations of existing buildings.
The construction industry places high hopes on the revision of the Building Code, which aims to ease the construction process for municipalities in tight housing markets. Yet, the umbrella organization of craftsmen flags the potential repercussion if urban commercial properties are suddenly converted to residential spaces, leading to the displacement of craft businesses and small firms. The organization represents the interests of over 54,000 businesses employing around 280,000 people.
Industry Insights:
While specific Saxon regulations aren't explicitly outlined, broader challenges in the German construction sector paint a picture of the context:
- Infrastructure Obstacles: Delays in major projects across Germany, including those in Saxony, reflect the intricacies of infrastructure development and the need for collaboration among stakeholders to tackle challenges.
- National Priorities: Germany is prioritizing infrastructure and energy projects, driven by substantial government investment and climate goals. However, this shift can also leave room for political and cost instability.
- Labour Regulations: Labors costs in the construction industry might be affected by minimum wages and specific regulations introduced by certain German federal states.
- Green Construction: Initiatives like platinum-certified lab buildings in Göttingen highlight a growing focus on sustainable construction practices, which could influence future regulatory standards and practices.
The Impact on the Industry's Crisis and Recovery:
- Infrastructure Delays: Continuing delays on major projects highlight the challenges in infrastructure development, potentially stalling economic growth and recovery.
- National Shift: Embracing national priorities on infrastructure and energy projects could foster growth and opportunities, yet it can also present risks due to political and cost uncertainties.
- Sustainable Construction: Adopting sustainable construction methods can contribute to long-term recovery by reducing environmental impacts, attracting eco-conscious investors, and enhancing the industry's reputation and competitiveness.
- The Saxon Craftsmen's Association suggests that community policy should focus on simplifying construction processes, reducing bureaucratic hurdles, providing residential development incentives, and streamlining planning and approval procedures to speed up the construction industry recovery.
- In addressing the crippling housing shortage, policymakers are urged to provide predictable, manageable grants, tax relief, and less bureaucracy for clients and contractors, especially in the context of sports and leisure facilities, where efficient construction processes are crucial for maintaining community engagement and economic development.
