Rosy prospects for home builders: GroKo plans for home ownership

With a two-thirds majority, the SPD has opted for a grand coalition. Changes are also planned for home ownership formation. You can find out what these are and what other builders, apartment buyers and landlords can expect here.

The GroKo plans for home ownership let the Builder's Protection Association (BSB) breathe a sigh of relief. The new federal government wants to provide more support to house builders, families willing to build and apartment buyers in the future. Energetic modernization is also sought, but time is short. “After the long negotiations, it is important that the new government quickly implements the planned measures. Consumers need planning security,”said Florian Becker, managing director of the BSB.

With the "Alliance for Affordable Housing and Building", which was launched in 2014, the aim is to "improve the conditions for the construction and modernization of living space in good quality, and effectively to a better offer in the areas with a lack of living space.”For example, the federal government already supports the social housing construction of the federal states with 1.5 billion euros per year. But there is still a lot to tackle. You can read about the plans the Grand Coalition has already planned below.

Child benefit

The child benefit is intended to make it easier for young families to find their own home and is 1200 euros per child per year for first-time buyers (whether new or existing). It is granted over a period of 10 years. However, there is an income limit of EUR 75, 000 per year for taxable household income (plus EUR 15, 000 per child). Negotiators assume that the child benefit will cost around 440 million euros a year. The grand coalition also hopes that the vacant rental space will counteract the housing shortage.

It is still unclear whether first-time buyers will also be relieved of the real estate transfer tax, because critics are certain that the real estate transfer tax literally eats up the child benefit.

Property tax C

The new GroKo wants to boost construction in cities and has therefore decided to introduce property tax C. This means that unused land will be taxed more heavily in the future, so that speculation with coveted building land, especially in inner cities, will be contained. Property tax C is not a new idea. It was established in the years 1961 to 1963, because there was also a shortage of building land back then, just like today.

Energetic building modernization

The energetic modernization of buildings is urgently necessary - the new federal government also knows this. While building renovation was neglected under the old government, it is now to be taxed. So far, however, the topic has only been formulated very vaguely in the coalition agreement; there are no concrete financial commitments yet. The building energy law, which failed in 2017, is also to be enforced under the new government in order to reconcile affordable building and climate protection in the building sector.

Revision of property developer contract law

The developer protection association has been demanding the revision of property developer contract law for years. Therefore, the inclusion of the problem in the coalition agreement is all the more gratifying in his view. The aim is to close the existing gaps in protection in the event of the developer becoming insolvent. So far, it has been extremely difficult for the consumer to get out of the contract and is therefore insufficiently secured in such a case.

Modernization levy

The GroKo has also decided that the modernization levy, which allows landlords to pass costs on to tenants, should be reduced from 11 percent to 8 percent.

Improvement of the housing premium

With the housing construction premium, GroKo hopes to make the early build-up of equity more attractive. The income limits are to be adapted to the general development of income and prices and to an increased premium rate. This primarily addresses a structural problem caused by the ECB's ongoing zero interest rate policy.