Because of the slowdown in housing construction, the federal government wants to expand state aid for building or buying your own four walls and invest another billion euros in residential homes. Construction Minister Klara Geywitz announced this in an interview with the German Press Agency before the housing construction summit on Monday.

The SPD politician admitted that the official target of 400,000 new apartments in 2023 will be missed even more significantly than last year, when almost 300,000 units were completed. “We’ll probably complete a little less this year than last year. But I don’t expect we’ll see a dramatic drop in completion numbers.”

Building applications have fallen massively, said Geywitz. “That’s why we will now provide economic stimulus.” She mentioned the already announced 18 billion euros from the federal government for social housing. “Together with the contributions from the states, around 45 billion euros are available until 2027.”

The next steps

On the other hand, the 500 million euro program for young living will be extended by two years, an increase of one billion euros. “This means that a total of 1.5 billion euros will be available to finance student and trainee dormitories,” said Geywitz. 5,745 new dormitory places are already being planned and a further 3,600 will be renovated. “This is money well spent,” said the minister.

Regarding the planned expansion of home ownership promotion for families, Geywitz said: “To this end, we will significantly increase the income limit from 60,000 euros. We will also increase the loan amount again.”

In addition, it makes ecological sense “that we also support families in purchasing and renovating an existing house.” The minister did not give any details before Monday. A meeting is planned in the Chancellery on the question of how quickly inexpensive apartments can be created.

Geywitz said: “I believe that in the foreseeable future we will not return to the level of interest rates we have had in recent years.” There is currently a “short-term shock situation” due to the jump in interest rates and high inflation. “I assume that market participants will have gotten used to the higher interest rate levels in a few years.” It is therefore important to maintain construction capacity.

IG Bau for 50 billion economic stimulus package

Before the top meeting, the Construction-Agriculture-Environment industrial union also reiterated its demand for a 50 billion euro economic stimulus program for housing construction. “Especially recently, economic stimulus programs have been launched quite successfully. It’s about time again,” said chairman Robert Feiger to “Bild am Sonntag”.

High interest rates and sharply increased costs had stalled the construction engine in recent months. Affordable housing is difficult to find in many places.

“Housing construction is threatened with disaster,” said Feiger. “The traffic light’s goal of building 400,000 apartments per year is missed year after year. The construction figures are getting lower and lower – even as the number of residents increases.”

The Association of Cities and Municipalities (DStGB) also called for a clear signal from the meeting. “Accelerating the planning and approval process for housing construction, limiting construction costs and further strengthening investments in housing construction,” is how managing director Gerd Landsberg outlined the necessary measures in the “BamS”.

Tax relief is needed – both for new buildings and for existing renovations. “In addition, the federal government must increase funding for social housing promotion to at least five billion euros per year in the long term,” he told the paper.