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How can new living space be created quickly? This will be discussed today in the Chancellery at the housing construction summit. The Ministry of Construction wants loudly ARD capital studio present new incentives for home builders.
The Chancellor made building and living a campaign issue in Bavaria at the weekend. At an SPD event in Nuremberg, Olaf Scholz called on municipalities to designate more building land. “But we also have to ensure that we can build more cheaply,” the Chancellor shouted to the crowd. Building cheaper – that’s currently easier said than done. The prices for building materials are at record levels, and interest rates on real estate loans are also high.
At least at this point, the Federal Ministry of Construction sees an opportunity for relief. It is increasing a funding program for families who want to build their own home according to strict energy standards or buy a corresponding apartment: the so-called home ownership promotion. This involves discounted construction loans through the state development bank KfW. In the future, more families will be able to benefit from the program by increasing the maximum annual income limit.
According to information from ARD capital studios it is increased from 60,000 euros for a family of three to 90,000 euros. The Ministry of Construction also sets the loan amount high: the example family receives a maximum of 170,000 euros from KfW, 30,000 euros more than before. The effective annual interest rate should be 0.5 percent.
More families should benefit from the support program
Federal Construction Minister Klara Geywitz hopes that under these conditions more families than before will apply for home ownership support. So far, the program has hardly been received by people. For families with small and medium incomes, construction projects based on the EH40 energy standard are hardly affordable. Accordingly, just 245 applications have been received since the program started in June. “We are therefore improving the funding conditions and making the program more attractive,” explains Geywitz.
At least the minister receives support within the coalition. Green Party co-leader Ricarda Lang says in an interview with SWR: “Basically, in times of inflation it is good to enable more people to build.” But Lang also makes it clear: Significantly more needs to happen so that house and apartment construction can move forward again. It brings an investment program into play: the federal government should provide 30 billion euros that will go directly to the construction industry. According to her, everyone would benefit if Germany were to grow more strongly and more living space was available.
Demands for constructioneconomic stimulus program
The construction industry would also have no objection to government subsidy programs. The Construction-Agriculture-Environment union is even calling for a 50 billion euro economic stimulus package. The real estate industry is not raising its expectations quite so high for today’s top meeting. On the wish list of the Central Real Estate Committee (ZIA), an umbrella organization for the industry, are further government loan programs through the KfW development bank. Without such offers at low interest rates, major investors would not start new projects, says ZIA President Andreas Mattner.
He makes a simple calculation: The return on building rental apartments is currently around two percent, but the loan interest is four to five percent. “So they still have to bring money with them. Everyone can imagine that that won’t lead to results.” It is particularly important now that large numbers of apartments are built.
Several institutes assume that there will soon be a shortage of 700,000 apartments in Germany. “That’s the entire inventory of Bremen and Saarland combined,” Mattner points out. The need continues to increase because more and more refugees are coming to Germany. “This is turning into gigantic chaos.”
Associations boycott the top meeting
ZIA President Mattner will take part in today’s meeting in the Chancellery – unlike his colleagues from the umbrella association of the housing industry GDW and the owners’ association Haus&Grund. They boycott the event. Their argument: The government is not doing enough to promote construction and has deliberately ignored loud warning signals from experts. Instead, the traffic light coalition only increases the requirements for construction, for example in terms of climate protection.
Axel Gedaschko from GDW is particularly annoyed by the Building Energy Act. The funding rates for heating conversions are fatal for landlords. “A total disadvantage. What we don’t understand either, because every cent that goes to a landlord indirectly benefits the tenant. That has to be passed on.”
According to its own information, the GDW, together with Haus&Grund, represents more than 95 percent of the real estate portfolio in Germany. Both associations make it clear that they do not want to withdraw from the Alliance for Affordable Housing and Building, but would like to send a signal by boycotting the meeting today. And they give the Chancellor a recommendation with a vocabulary that the Chancellor himself coined: The construction and real estate industry needs nothing less than funding with “oomph.”