In total, 371,300 documents were issued over the past 12 months, which is a year-on-year decrease of 28.3%, according to ministry data.
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The new real estate crisis is getting worse. Building permits continued to fall in September, with 371,300 new housing units authorized over the 12 months, down 28.3% year-on-year, according to preliminary data released by the Department for Environmental Transformation on Friday (October 27). Since the record high reached in August 2022, due to regulatory deadlines, the number of permits issued each month has stabilized at a low level, relentlessly reducing the annual total.
Estimated construction starts, which traditionally trail permits by several months, are also down significantly, with 315,800 construction starts over the 12 months, down 16.6%. The decline in permits applies to all types of housing, purely individual (-31.8%), group individual including subdivision (-27.6%) and collective (-28.3%). Residences (students, seniors, etc.) suffer slightly less (-19.7%).
Slowing real estate market
New properties are experiencing both a sharp decline in buyer purchasing power and an increase in construction costs. The rapid rise in interest rates has put many buyers out of the market, especially first-time buyers whose incomes are also being squeezed by inflation.
On the side of developers and builders, successive global crises (pandemic, war in Ukraine, etc.) have caused a sharp increase in the cost of construction materials, and the tightening of environmental regulations for new projects adds further additional costs to operations. Developers also point to the reluctance of mayors to grant permits, under pressure from administrators unwilling to accept new construction.