How the federal government promotes home ownership and new construction: an overview

They are intended to ease the tense situation in the construction industry and help families to own their own homes: The Federal Ministry for Construction has presented the balance sheet of the construction funding programs for 2025.

The Federal Ministry of Construction has presented a review of its funding programs for 2025. All programs are to be continued in 2026. With the temporarily introduced New construction subsidies for the EH55 standard Furthermore, a new program with a budget of 800 million euros has been launched. The ministry also stated that the conditions and funding criteria for the other funding programs have been significantly improved in some cases.Over 64.000 climate-friendly residential units “We were able to provide funding last year,” he says Sören Bartol, Parliamentary State Secretary in the Ministry.

An overview: 

EH55-Plus funding

Since December 16, 2025, there has been a temporary funding opportunity for new buildings with Efficiency House Standard 55 and 100 percent renewable energies, short EH55-Plus fundingThe funding is provided through subsidized KfW loans. 

By the end of 2025 nearly 14.000 residential units The project will be supported with a loan volume of €1,3 billion. The total amount of investments initiated is approximately €3,6 billion. 

A total of 800 million euros is available for the program.

Climate-friendly new building (KFN)

The schedule "Climate-friendly new building" promotes the construction and first-time purchase of climate-friendly and energy-efficient residential and non-residential buildings.

Investors, cooperatives, companies and private individuals They can apply for funding through subsidized loans from their local bank. Municipalities can receive grants. Funding is provided via subsidized KfW loans.

Greater support is available for buildings that also Quality Seal for Sustainable Buildings (QNG) The ministry reports that interest rates were improved in September.

In 2025, funding commitments totaling approximately €4,5 billion were granted for the KFN program. This triggered a total investment of €13 billion, supporting 36.747 residential units.

Climate-friendly new building in the low-price segment (KNN)

With the KNN program can climate-friendly and space-efficient new buildings and their initial acquisition It will be promoted. The affordability of housing will be supported by a limit on construction costs.

The funding for Investors, cooperatives, companies and private individuals This is done through subsidized KfW loans. Municipalities can receive grants. In September 2025, there were improvements to both the program terms and interest rates.

Since then, even more projects have been able to benefit from the funding. By the end of 2025, 8.214 residential units had received funding. A total of approximately €859 million in funding commitments had been granted, triggering total investments of around €2 billion.

Home Ownership Promotion for Families (WEF)

The federal government supports families with children in the area of ​​homeownership promotion through its homeownership promotion program.Construction and purchase of newly built, climate-friendly residential propertyThe goal is to enable families to take the step towards home ownership.

The funding is provided through subsidized KfW loans, thus relieving the financial burden on families even before construction begins and noticeably over a long period. The new program therefore offers homeowners reliable financial support, making climate-friendly construction projects both predictable and affordable. Furthermore, the program's funding conditions were improved last year through a reduction in interest rates.

In 2025, the construction or acquisition of 4.554 residential units was approved with a loan volume of 843,5 million euros.

Young Buys Old (JkA)

The Funding program "Young buys old" supports families with children and lower to middle incomes in acquiring residential property in need of renovation.

The funding is provided through subsidized KfW loans. This gives families the opportunity to renovate existing houses not only in urban areas but also in rural and sparsely populated regions. The funding can be combined with other renovation support programs.

In 2025, 690 funding commitments were granted with a loan volume of 80,03 million euros. 

Promotion of cooperative housing 

With its funding program for cooperative housing, the German Federal Government supports private individuals in acquiring cooperative shares, thus facilitating access to permanently affordable housing for potential members. Furthermore, the acquisition of cooperative shares strengthens the equity capital of the cooperatives for investment measures.

Funding is available for both new cooperatives and for joining an existing housing cooperative. A prerequisite is that the cooperative apartment is owner-occupied. Funding is provided through subsidized KfW loans.

The funding conditions were improved again on February 3, 2026. Maximum loan amounts of €150.000 are now possible, and the repayment subsidy has been doubled to 15 percent (previously 7,5 percent).

In 2025, 390 funding commitments with a loan volume of approximately 28,8 million euros were granted under the program.

Source: BMWSB

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