NAfter the Bundestag passed a budget for the current year after some delay, house builders can also expect more funding from the federal government. This should not only benefit builders who are struggling with high interest rates, but also help the ailing construction industry.
At the end of last year, some programs ran out of money as a result of the Federal Constitutional Court's ruling on the climate and transformation fund and the restructuring of the budgets for 2023 and 2024. With the programs now starting up again, certain projects can count on particularly favorable funding. For climate-friendly and energy-efficient buildings, living space for families, the acquisition of shares in housing cooperatives and age-appropriate renovations, the federal government offers conditions that other financiers cannot offer in the new interest rate environment.
Climate-friendly new building
In mid-December, among other things, funding for climate-friendly new buildings was stopped. Since last week, funding applications can once again be submitted to the federally owned Loan Agency for Reconstruction (KfW). The programs are numbered 297 and 298. In order to be considered climate-friendly, the new construction project – both houses and individual apartments are supported – must meet a number of criteria. It can use no more than 40 percent of the energy of a standard house.
The residential unit should not be heated with oil, gas or biomass. On top of that, the greenhouse gases emitted over the entire life cycle of the building must not exceed certain limits. The KfW grants loans of up to 100,000 euros per residential unit. At the start of the program, the interest rate is 2.1 percent, well below the current market interest rates. However, the interest rate is continually adjusted by KfW. If the building meets the criteria of a seal for sustainable buildings, the credit limit increases to up to 150,000 euros. The program also applies to the first purchase of newly constructed buildings.
The federal budget for the current year has earmarked 762 million euros for the climate-friendly new building program. This also includes funds for funding buildings that are not intended to be used for housing. Last year, similar amounts were initially budgeted, but due to high demand the program was increased to 1.7 billion euros. According to KfW, 17,494 private residential buildings were funded before the program was stopped at short notice in December. KfW recommends that applicants consult specialists in energy efficiency and sustainability for planning and construction supervision in order to comply with the funding criteria and certify this. The promotional loan is arranged through the real estate financiers and cannot be applied for through KfW.
Home ownership for families
For families, the conditions for climate-friendly and owner-occupied residential buildings are significantly cheaper. Analogous to the program for climate-friendly new construction, promotional loans are granted for the construction or initial purchase of houses and apartments that are particularly energy efficient and comply with the guidelines for greenhouse gas emissions through construction, use and dismantling. The household income of a family with one child must not exceed 90,000 euros. For each additional child, this upper limit increases by 10,000 euros. The maximum amount of the promotional loan under program number 300 is 170,000 to 270,000 euros.
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