Introduction
As markets cool, new opportunities arise
The German economy has been relatively stable over the past year. Quarterly Gross Domestic Product (GDP) results remained almost unchanged until Q4 2023, where GDP dropped 0.3 percent after two consecutive stagnant quarters. Rising construction prices have also slowed in the last year, with the quarterly rise dropping to around 0.5 percent for the first time since Q4 2020. Along with the continued decline of the number of contracts quarter on the quarter, the construction industry in Germany is seeing a cooling off period.
With demand in the construction sector experiencing a decline and the market showing signs of cooling, primarily due to a steady decrease in construction contracts, inflation is anticipated to follow suit. Prices are flatlining, and there are limited expectations for significant gains in 2024.
The second edition of our Germany market intelligence report helps identify how to operate in changing market conditions and where to prioritise efforts during the slow but steady change from a contractor favourable market into a client favoured market.
At a glance
1.0%
Turner & Townsend tender price inflation forecast for 2024
-4.4%
Regression of new orders in main construction 2023 compared to 2022
0.3%
Average quarterly construction cost escalation in Q3 2023
0.4%
Average quarterly construction cost escalation in Q4 2023
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