Home Ownership : Germany

90 percent of all German families dream of owning a house or condominium. This coincides with the Federal Government’s aim of spreading assets as far as possible. People deciding to build or buy their own home receive an owner-occupied homes premium, which is paid out directly by the tax office, and - depending on their income - may be eligible for other forms of state assistance such as grants or loans.

The owner-occupied homes premium, which since 1 January 1996 has replaced the previous tax incentives for home ownership, is paid for eight years, irrespective of the individual’s income, and amounts to DM 5,000 per year for new buildings (DM2,500 per year for existing buildings) with a pur chase price or restoration cost of at least DM 100,000. In addition, a child allowance of DM 1,500 per year is paid for each child. Together with the (likewise improved) measures to promote home ownership savings plans, this new arrangement will help to stimulate home acquisition, especially in the new federal states.