If we examine residential construction since 1991
we find exactly opposing trends in Germany
and the rest of the Eurozone.
Germany initially had a very
high rate of investment in housing, which fell sharply with
the end of the German property boom in the late 1990s.
After the introduction of the euro, construction boomed
in the other Eurozone countries, especially Spain and
Ireland. But here, as previously in Germany, the activity
was largely unsustainable and investment in housing fell
sharply from 2007.
As a consequence many Eurozone
countries are now experiencing an adjustment crisis in
housing construction, similar to Germany’s between
1999 and 2005. After 2010 there are again diverging
trends between Germany and the rest of the Eurozone:
the rate of investment in housing has increased strongly
in Germany and now exceeds that of the other Eurozone