Subsidies for your German mortgage — all grants at a glance

The German state supports home ownership and energy-efficient renovation with numerous subsidy programmes. Knowing the right ones and applying in time can save you several thousand euros. Here is an overview of the most important programmes.

KfW programmes

The Kreditanstalt für Wiederaufbau (KfW) is the most important state subsidy provider for home ownership. Several programmes are available:

Home-ownership programme (KfW 124): up to €100,000 at favourable rates for buying or building an owner-occupied property. The loan can be flexibly combined with bank financing and offers repayment-free initial years.

Climate-friendly new build (KfW 297/298): for building or first-purchasing a particularly energy-efficient new home, KfW grants reduced-interest loans of up to €150,000 per housing unit. The building must reach at least the Efficiency House 40 standard and meet greenhouse-gas requirements.

Home ownership for families (KfW 300): aimed specifically at families with children and a taxable household income of at most €90,000 (with one child; €10,000 more per additional child). It offers reduced-interest loans for climate-friendly new builds — between €170,000 and €270,000 depending on the number of children and sustainability standard (QNG seal).

"Jung kauft Alt" (KfW 308): families within the same income limits as programme 300 receive reduced-interest loans for buying an existing property in need of renovation. Condition: the building must be renovated to at least the Efficiency House 70 EE standard within 54 months.

Wohn-Riester (home-ownership pension)

The home-ownership pension, better known as Wohn-Riester, lets you use the state Riester subsidy for buying or building an owner-occupied property. The principle: you pay into a certified Riester contract and receive allowances and tax advantages.

The basic allowance is €175 per year. For each child eligible for child benefit, another €185 (born before 2008) or €300 (born 2008 or later) is added. To receive the full allowance you must contribute 4 percent of your gross income subject to pension insurance — minus the allowances.

Important to know: Wohn-Riester is taxed downstream. The subsidised capital is recorded on a virtual housing-subsidy account and taxed in retirement at your personal rate. The model still pays off in most cases, especially for families with children.

Grants for energy-efficient renovation (KfW & BAFA)

For the energy-efficient renovation of existing properties there are grants from the Federal Funding for Efficient Buildings (BEG). Good to know: since 2024, KfW handles heating replacement, while BAFA continues to fund measures on the building envelope.

Heating subsidy (KfW 458): installing a climate-friendly heating system such as a heat pump, biomass system or solar thermal is subsidised with up to 70 percent of eligible costs. The basic subsidy is 30 percent, plus bonuses for early replacement (20 percent climate-speed bonus) and income-dependent grants (30 percent income bonus for taxable household incomes up to €40,000). Applications go directly to KfW.

Individual envelope measures (BAFA): insulation of walls, roof and basement as well as replacing windows and exterior doors is subsidised with 15 percent of the costs — 20 percent with an individual renovation roadmap. These grants are still applied for online at BAFA.

Regional programmes

NRW.BANK: the development bank of North Rhine-Westphalia offers low-interest loans for owner-occupied homes. Particularly interesting is the housing subsidy for middle-income households. Conditions are usually well below market level.

Municipal programmes: many cities and municipalities offer their own schemes — for example discounted building plots, grants for young families or premiums for buying in certain districts. Ask your local authority about local options; offers vary greatly by region.

Application tips

Mind the order: always submit the subsidy application before concluding the purchase or construction contract. Once you have signed, funding is generally excluded. This applies to KfW programmes as well as BAFA grants.

Combine subsidies: many programmes can be combined. For example, a KfW loan can be paired with an NRW.BANK loan and Wohn-Riester. Watch the accumulation rules — in total, subsidies must generally not exceed the overall costs.

Meet the deadlines: watch application deadlines and approval periods. KfW loans are applied for via your bank and usually take two to four weeks to process. BAFA grants are applied for directly online.

Professional advice: the subsidy landscape changes regularly. Have a non-tied financing advisor brief you on the currently available programmes so you don't miss an opportunity.