The role of the state for affordable housing
Source：Taiwan Trade Center, Sofia
From：Taiwan Trade Center, Sofia
Update Time：2023/06/13
The year 2022 witnessed a substantial surge in new construction prices, with an 18% year-by-year increase. Additionally, the overall cost of construction experienced a staggering 30% jump, primarily driven by the soaring material prices. These findings were presented by Georgi Shopov, the chairman of the National Association of Construction Contractors, during a comprehensive briefing centered around addressing the issue of housing affordability. In their concerted efforts to normalize price levels, builders have proposed several measures that the state could potentially adopt.
One of the recommendations put forth by the association is the reduction of administrative burden, emphasizing the wider implementation of electronic documentation. By embracing digital solutions, such as streamlined online processes, the construction sector aims to enhance efficiency and reduce bureaucratic complexities, ultimately contributing to cost savings that could be passed on to homebuyers.
Another critical aspect highlighted is the urgent need for expeditious regulation of territories surrounding the major cities. By swiftly addressing zoning and planning issues, the state can stimulate the investor’s interest in these areas, opening up new possibilities for affordable housing development.
It is worth noting that the sharp increase in construction material prices has also played a significant role in driving up overall costs. For instance, the price of rebar blanks has seen a 100% surge, while bricks and wood have experienced substantial price hikes of 50% each. However, despite these considerable material cost escalations, the final housing prices have risen by a relatively modest 18%. This indicates that builders are currently operating with reduced profit margins as they strive to maintain affordability for potential buyers.
The concerns raised by the National Association of Construction Contractors underscore the urgency of addressing housing affordability issues. The proposed measures, ranging from administrative streamlining to targeted regulation, aim to create a more conducive environment for affordable housing development.