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Child benefit is not only for first-time owners
Child benefit is not only for first-time owners

With the new construction child allowance introduced in 2018, the Federal Government is supporting residential property for ten years with 1200 euros per child per year - but the rules and deadlines are tight. Nevertheless, there is also an option for parents who already owned a property before 2018 to receive child benefit.

Property and property prices have risen sharply in recent years due to the low level of interest rates - not only in the metropolises, but also in many more rural regions. Without government grants such as the new construction child benefit, solid building finance is becoming increasingly difficult for young families.

However, the rules for building child benefit are relatively narrow: only child benefit recipients whose household has at least one child under the age of 18 at the time of the application are eligible for funding. In addition, only properties that have been bought or approved and occupied from 2018 onwards are funded. Exception: If you purchased a rental property that you already lived in in 2018, only the purchase date is relevant as the key date.

Interested parties who already purchased and lived in a property in 2018 before the introduction of the construction allowance can still take their time until December 31, 2018 with the application. Anyone who moves in after the introduction date of the child benefit (September 18, 2018) has three months to submit the application for funding to KfW.

Condition: No further own property upon application

Annoying: Anyone who has already realized their residential property before 2018 can no longer have this property subsidized by the child benefit - even if they meet the other funding conditions. In this case, however, there is a loophole in the law that can be particularly lucrative for families with many children, whose home ownership has become too small: The only thing that is important is that at the time the application is made, one does not own or rent a property.

Alia Begisheva, deputy press spokeswoman for the KfW banking group, explained the situation to us on request: “No household member may belong to any other residential property in Germany on the date of the purchase contract or the building permit. This also applies to rented apartments. However, it is irrelevant for the subsidy from the child benefit if the owner has already owned a property that he had sold before the new apartment was bought.”

Holiday homes and apartments are also excluded

This means: If you already bought or built a house before 2018, your entitlement to child benefit will not automatically expire. It is only important that you have already sold this property as soon as you sign the purchase contract for a new one or receive a building permit for another property. The eligible property does not have to be your first - but the only one that you own at that time. Pure holiday properties or real estate abroad are also excluded. They do not necessarily have to be repelled in order to be able to receive the child benefit for a new, self-occupied property.

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