Buying a house: using government subsidies intelligently

The prices for existing properties know only one direction: upward. The fact that people who want to buy benefit from favorable interest rates on loans no longer compensates for this trend. Bargains can only be found in areas with low population density, little infrastructure and no attractive employment opportunities. Prices have risen particularly sharply around major cities. The baukindergeld expired in march 2021. Does this mean that the dream of owning your own property is over?? The possibility of receiving state subsidies for buying a house opens up a number of options for interested buyers.

Federal and state development banks

When it comes to low-interest loans and grants when buying a house, the kfw is the first address that should be involved in any financing. After the second world war, the abbreviation stood for "kreditanstalt fur wiederaufbau. After almost eight decades of peace, the kfw is now concerned, for example, with energy-efficient renovation, promotion of renewable energies, barrier-free living and smart-home equipment. The program that is always suitable for the purchase of a house is the product 124 (kfw wohneigentumsprogramm). Subsidies are available for the purchase or construction of owner-occupied homes or condominiums with a loan volume of up to 100.000 euro. This loan can be combined with other incentive programs, for example, products 261, 262 (residential building loan) for efficiency homes or related individual measures, or product 159 (age-appropriate remodeling).

In addition to the kfw, there are also promotional banks in the federal states as well as special municipal programs. You should talk to your bank or a local real estate agent about this, because the offers vary greatly from region to region. If you buy a house in bad soden am taunus (hesse), the funding may be different from that in karlstein am main (bavaria), just forty minutes away by car and within the catchment area of the frankfurt metropolitan region, but in a different federal state.

Social housing promotion

Low-income families can benefit directly or indirectly from the housing subsidy law. The law allows the federal states to provide funds that either benefit the family in the purchase of real estate or support the construction or. Financing the expansion of rental housing. In the latter case, it must be ensured that the housing is rented for many years to the socially vulnerable. Social housing subsidies are subject to strict income limits. The federal government has made proposals for this, but the states can deviate from them. Here, too, expert advice is needed on the spot.

Saving with the wohn-riester

The riester pension doesn't have too good a reputation – often unfairly so. In the area of real estate financing, residential riester is worth considering. The homeowner's pension, which was introduced in 2008, enables riester savers to withdraw money from their pension assets that would otherwise not be available to them. Only with negative consequences for allowance or. Tax advantages would be possible. The money can be used to buy or build a property or to repay a property loan. With this option, the legislator is taking into account the fact that rent-free living in old age can also be a pillar of old-age provision. It should be noted, however, that with the reduction in the maximum actuarial interest rate for pension insurance, insurers are no longer able to provide the capital guarantee required by law. This is why the riester pension is now hardly ever offered. Current contracts are not affected by the reduction in interest rates and can also be used for residential mortgages.

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