Around 73 million euros extra in 2024The Free State of Saxony is providing significantly more funding for housing construction this year: a total of around 73 million euros more funding can be made available for the construction of social housing and for the creation of home ownership. This was announced today (February 28, 2024) by Thomas Schmidt, Saxony's Minister of State for Regional Development. “The higher funding will help to ensure that more construction can take place again. Above all, it will benefit the construction industry and the building trade. The industry found itself in a very difficult situation last year because construction activity came to an increasing standstill due to high costs, high interest rates and high standards,” said the minister. “Something must be done here. Because if companies give up or cut jobs, then the construction industry will permanently lose capacities that we will urgently need in the coming years.” The state government is providing 105 million euros this year for home ownership - around 26 million euros more than was approved in 2023. The funds are used, on the one hand, through the Family Housing Guideline (RL Familienwohnen), through which the Free State supports families with very low-interest loans (less than one percent) and a 25-year fixed-interest period when building or acquiring home ownership, depending on the number of children. On the other hand, the funding guideline for home ownership in rural areas (RL WLR) will be offered again from April. This means that households without children in rural areas, i.e. outside Chemnitz, Dresden and Leipzig, can also receive support for the construction or purchase of residential property, but also for the renovation or expansion of existing residential property. This funding guideline also provides very long-term loans at a very favorable interest rate. This year, almost 187 million euros are available for the creation of so-called social housing, an increase of 47 million euros compared to the funds approved last year. The guideline for the construction of social housing in the two cities of Leipzig and Dresden is supported by the guideline for tied rental housing. In addition, the guideline for affordable rental housing is available throughout Saxony. With its help, existing living space can be renovated and then rented out as social housing. A requirement of both guidelines is that the apartments are subsequently rented only to persons in possession of a certificate of eligibility for housing. “In addition to increasing the funds that we provide for the construction and renovation of housing, we already took a whole range of measures last year to support the construction industry in its severe crisis,” said the minister. ”For example, we sought close dialogue with the construction and real estate industries as well as the skilled trades at an early stage. At the initiative of Saxony, the demands of the 'Dresden Declaration' were made a topic of the Conference of Construction Ministers, which addressed a whole catalogue of demands to the federal government.” Saxony itself has done its homework, Minister of State Schmidt continued: ”We have tackled issues that we can implement without the federal government. For example, the Saxon state parliament amended the building code in January. In the future, it will make it possible to convert attics without requiring a permit, it will ease the obligation to create parking spaces and will enable building type E, which allows for simpler and thus more cost-effective construction.” Improvements in funding were also made last year. The funding rates of the RL gMW were adjusted to the increased construction costs and increased by around 20 percent. In the case of modernization funding (RL pMW), the maximum funding amounts were raised in view of the increased construction prices. In addition, a climate component with particularly attractive conditions for renovations was introduced, with which the “Efficiency House 85” standard is achieved. This funding was also extended to the cities of Dresden and Leipzig, where it had not previously been offered. An attractive interest rate for loans, coupled with subsidies, means that the funding program has been very well received. In the case of home ownership funding (RL Familienwohnen), the funding conditions were already improved in 2022. The permissible total expenditure was increased from 300,000 euros to 425,000 euros. Despite rising interest rates on the capital market, the very favorable interest rate of 0.75 percent has been maintained for the entire 25-year term. Source: Medienservice Sachsen