Funding for new construction secured until the end of 2023 – increase by 888 million euros

Funding for new construction secured until the end of 2023 – increase by 888 million euros

New construction of single-family houses

The new construction subsidy provides, among other things, to support families with low and medium incomes in particular in building their own house and at the same time making provisions for old age.

(Photo: dpa)

Berlin Funding for new construction will be increased from EUR 1.1 billion to EUR 2 billion. This was announced by the Federal Ministry of Building on Friday. Since the “climate-friendly new building” funding program has been so well received, it is said that an increase of 888 million euros is now being made with the support of the Federal Ministry of Finance and the Federal Ministry of Economics. This means that the program is secured until the end of the year, said the Federal Minister for Construction Klara Geywitz (SPD).

Last year had to Minister of Economy Robert Habeck (Greens) stopped state support twice because the funds had run out. After that, the conditions were tightened.

The new construction subsidy consists of two elements: Firstly, from the “climate-friendly new construction” program, which started on March 1st and for which 750 million euros have been available so far.

Low-interest loans are used to finance new construction and the first-time purchase of residential buildings and condominiums in Germany promoted, which meet the energetic standard of an efficiency house 40 (EH40). EH40 means that a building only uses 40 percent of the energy that a legally defined standard house requires.

There is even greater support for buildings that also have sustainability certification according to the “Sustainable Building” (QNG) quality seal.

Home ownership promotion for families is scheduled to start on June 1st

The second element of the federal government’s new construction subsidy is the “home ownership subsidy for families”, which is scheduled to start on June 1st, i.e. as early as next week. Here, families with low and middle incomes in particular should be supported in building their own house and at the same time making provisions for old age.

>> Read here: New home ownership support for families starts on June 1st

Families with a taxable annual income of up to 60,000 euros a year should receive low-interest loans. Each additional child increases the threshold by 10,000 euros, the ministry had already announced. The funding conditions would be presented shortly, it said on Friday.

On January 1, 2023, responsibility for the promotion of new construction was transferred from the Ministry of Economic Affairs to the Ministry of Construction. The Economics Ministry led by Robert Habeck (Greens) is still responsible for the inventory and renovation of existing buildings. Around 13 billion euros are made available for this every year.

It was initially unclear whether this amount was reduced in favor of the Ministry of Construction. Building Minister Geywitz said on Friday that the federal government’s new building subsidies make an important contribution to the creation of affordable housing and climate-friendly construction. It would “simultaneously create incentives to invest in construction despite inflation, higher interest rates and energy prices”. “I would like to thank my cabinet colleagues Christian Lindner and Robert Habeck for their support.”

More: How the state makes housing construction more difficult with conditions and costs

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