The construction sector has recorded a positive performance since the beginning of the year, maintaining the upward trend of the last few years, according to Alpha Bank’s data. In particular, the Gross Value Added (GVA) of the construction sector in the first half of 2024 (at constant prices) amounted to 2.1 billion euros.
As noted in Alpha Bank’s report, on an annual basis (compared to the first half of 2023), it recorded a marginal decrease of 0.9%, which, however, is attributed to base effects, as the first half of 2023 had marked an increase of 21.6%. In addition, construction GVA has been growing faster than total GVA in most quarters from 2017 onwards, resulting in the share of the sector’s output increasing from 1.3% in the first half of 2017 to 2.4% in the first half of 2024.
Despite this increase, this percentage is significantly different from the corresponding one in the first half of 2010 (4%), which demonstrates the losses suffered by the sector since the financial crisis of the last decade. Investments in construction (residential and other structures), which recorded an increase from 2020 onwards, amounted to 5.3 billion, marking a marginal decrease of 0.8% compared to the first half of 2023, when an increase of 21.2% was recorded.
Obstacles
At the same time, investments in housing decreased by 10.5% (H1 2023: +47.1%), while investments in other non-residential constructions increased by 4.9% (H1 2023: +10%). The seasonally adjusted Construction Production Index rose 8.6% year-on-year in the first half of 2024, recording, after Croatia and Malta, the third largest increase among the member states of the European Union (EU-27).
At the same time, it is noted that the construction industry faces significant obstacles, such as the higher cost of building materials used in the construction of new buildings, the high interest rate environment, which, among other factors, negatively affects the demand for loans for housing purposes and the pending New Building Regulation.
From July 2021 to September of this year, the New Building Construction Materials Price Index has increased cumulatively by 27.4%. Over the same period, in the two main categories of materials, whose combined weighting exceeds 44% of the index, which are mortars and ready-mixed concrete, as well as basic processed metal materials, prices have soared by 23.3% and 28.3%, respectively.
