Real Estate News

Experts warn of collapse in housing construction in Berlin

Experts warn of collapse in housing construction in Berlin

In the Berliner Zeitung newspaper dated 2 February 2026, Yoko Rödel reports in detail on an online press conference with representatives of real estate and construction companies as well as construction law experts on the so-called ‘Bauturbo’ (construction turbo). The article states that despite the Construction Acceleration Act, Berlin’s construction sites remain sluggish, and experts warn of a massive slump in residential construction. Almost a year after Chancellor Friedrich Merz announced upon taking office that he would speed up residential construction, the construction industry remains in crisis mode. Although individual regions have seen modest growth, on average construction activity continues to stagnate at a low level. The situation is similar in Berlin, where residential construction in particular is failing to gain momentum, even though the capital is estimated to be short of 150,000 affordable apartments. The situation has now become so precarious that industry representatives fear that residential construction could soon come to a complete standstill, causing rents to rise to more than 40 euros per square metre.

Actually, everything was supposed to turn out quite differently, as the Construction Acceleration Act passed in October 2025 was intended to create several thousand new apartments within a very short period of time. But nothing of the sort happened. Instead, the Minister of Construction made one faux pas after another, first praising her own policies on TikTok and then blaming landlords for the rent crisis. Since the start of her maternity leave at the end of 2025, there has been radio silence. No replacement has been appointed and the ministry is effectively leaderless. Three months after the law came into force, experts are drawing a sobering conclusion: the construction boom has failed to take off.

Berlin-based construction lawyer Jakob Hans Hien from Knauthe Rechtsanwälte pointed out that the term ‘Bauturbo’ suggests something that the law cannot actually deliver. In fact, it should be referred to as an ‘approval turbo’ because it does not speed up construction, but rather allows it to start earlier. The problem lies in the fact that the authorities can apply the construction turbo, but are not obliged to do so, which is the real bottleneck and the greatest uncertainty for project developers. Dieter Becken from Becken Holding sees the reason for the persistently low level of construction activity not only in sluggish procedures, but above all in the precarious project conditions faced by developers. These include expensive land, high construction costs and interest rates, coupled with growing technical and energy requirements for buildings. In the meantime, cost pressure has become so great that residential construction projects in Germany are hardly profitable anymore.

“Politicians urgently need to develop sensible solutions through targeted support and relief measures,” says Jacopo Mingazzini, CEO of The Grounds. “It is all the more

incomprehensible that in Berlin, the Green Party, the Left Party and now also the SPD are trying to outdo each other with proposals for further restrictions on the housing market, thereby deterring investors willing to build, instead of focusing on the only sensible way out of the tense situation: tangible support for new construction.”