Master builders’ association expects sales to fall in 2024
Published: Wednesday, May 29th 2024, 09:40
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Swiss construction companies generated more turnover in the first quarter than in the same period last year. However, the outlook is poor. This is particularly true for residential construction.
In the first quarter, turnover rose by a total of 0.7% to CHF 4.69 billion, as reported by the Swiss Association of Master Builders (SBV) on Wednesday. The various segments of the industry developed differently: turnover in building construction fell by 1.6 percent, while it rose by 3.6 percent in civil engineering.
This trend is likely to continue in the coming months. This is because building construction companies also received significantly fewer orders between January and March. Incoming orders slumped by 9 percent to 2.71 billion. Incoming orders in civil engineering rose by 4.8 percent at the same time. Overall, however, incoming orders for the entire sector fell by 2.2 percent to 5.72 billion.
Declining sales expected
According to the construction index, total construction activity in the second quarter is now likely to fall by 2.3% compared to the same quarter of the previous year, the press release continued. And in 2024 as a whole, sales are expected to be around 1.6% lower than in 2023 at CHF 23.0 billion.
Residential construction remains the industry's problem child. Around 50,000 new apartments were built in 2020. Since then, this figure has fallen year on year. For 2024, the SBC is forecasting just 40,000 new apartments. Measured against demand, this is far too little. There is a risk of a vacancy rate of 1.0 percent, compared to 1.15 percent last year. The association is therefore calling for faster building permit procedures and fewer requirements.
At least the recent interest rate cut by the Swiss National Bank gives hope. However, this will only have a delayed effect, according to the SBC. The association hopes that it will make a positive contribution to construction activity in the coming year.
©Keystone/SDA
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