Hessengeld: State government supports young families when buying real estate

Hessengeld: State government supports young families when buying real estate

The state government of Hesse is planning to provide financial support to young families purchasing their first home in order to counteract rising construction costs and interest rates. New subsidies under the name “Hessengeld” will be available from autumn. This program was presented at an extraordinary cabinet meeting in Wiesbaden-Nordenstadt. The subsidy amounts to 10,000 euros per first-time home buyer and 5,000 euros per child and is aimed primarily at young families, although single first-time buyers can also benefit from it.

The “Hessengeld” subsidy is granted retroactively from March 1st of the year and only applies to the purchase of residential property or land within the state borders for your own use. The payment is made over ten years in constant installments up to the amount of the real estate transfer tax actually paid. The state government estimates that around 23,000 property purchases per year could be eligible for this subsidy, with property transfer tax seen as one of the critical additional costs of purchasing property.

Despite the positive response from the construction industry, the effectiveness of the “Hessengeld” program is questioned by the opposition in the state parliament. Alternative proposals include investing the funds in other funding programs to make housing construction more affordable on a broader basis. The construction industry also emphasizes the need for further measures, such as reducing construction costs and property transfer tax, in order to make property acquisition more attractive for the population.