Construction funding programs can be applied for again

As of: February 19, 2024 6:02 p.m

Anyone who wants to build in a climate-friendly way or convert a property in an age-appropriate manner can again receive funding or low-interest loans. Starting tomorrow, applications will be possible at the state-owned KfW Bank.

After the program was stopped last December, state funding from the KfW Bank is to be available again for certain construction projects or house purchases. The focus of the funding is a program for particularly climate-friendly new buildings. Applications can be submitted from Tuesday.

Anyone who adheres to the so-called EH40 standard can receive cheap loans from KfW Bank – the interest rate is 2.1 percent, the maximum loan amount is between 100,000 euros and 150,000 euros. Last year, according to Federal Construction Minister Klara Geywitz (SPD), a good 47,000 apartments were supported by the program.

The offer is aimed at investors, cooperatives, companies or private individuals. The support is available for new construction or the first purchase of a building up to one year after completion. Municipalities and districts can apply for investment grants.

Up to 6,250 euros for age-appropriate modification

In addition, funding for cooperative housing is being relaunched – here the federal government is particularly supporting the acquisition of cooperative shares with low-interest loans. Anyone who sets up their own cooperative in order to then build or purchase shares will be able to take out loans of up to 100,000 euros at an interest rate (depending on the term) of between 2 and 2.5 percent; the repayment subsidy is 7.5 percent.

Finally, from tomorrow it will be possible again to apply for subsidies for the age-appropriate conversion of apartments – the amount of the subsidy depends on the measure, for example the removal of door thresholds or the conversion of bathrooms. Individual construction measures are subsidized with ten percent of the investment costs, up to a maximum of 2,500 euros. You can receive up to 6,250 euros for the entire renovation of a house

Housing construction in crisis

According to Construction Minister Geywitz, the funding programs are also important for the recently weakening construction industry. According to the Munich ifo Institute, the mood in the industry is currently worse than ever.

Housing construction is weakening, and the federal government is far from achieving its own goal of building 400,000 new apartments every year. The ifo Institute expects that only around 225,000 apartments will be completed this year.

One reason is the increased interest rates – this is where most of the federal government’s funding programs are based. This is the program for climate-friendly new construction, as Construction Minister Klara Geywitz explained: “The end customer interest rate is 2.1 percent and is significantly below the current construction financing – 2.1 percent, which means that building is once again affordable.”

Is the money enough?

The funding program for well-insulated and climate-friendly houses has not been in existence for a year yet. After just ten months, the money ran out in December and funding stopped. It is unclear how long the funds for KfW funding will last.

According to Geywitz, one billion euros are now available. Last year it was 1.68 billion. This makes it at least doubtful whether the money will be sufficient until the end of the year. The aim is to maintain the conditions all year round, said the minister. “The federal government is aware of the importance of stable funding conditions.” Another billion is earmarked in the federal budget for climate-friendly new construction in the low-price segment.

The main association of the German construction industry criticized that the federal government “still owes a consistent and reliable housing construction policy.” The funding was already insufficient last year. In order to avoid a funding stop, the Bundestag must debate an increase in funding by summer at the latest.

With information from Hans-Joachim Vieweger, ARD capital studio.

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