2023-08-02 15:14:01
The low number of new buildings is one of the biggest construction sites of the traffic light coalition. Instead of the promised 400,000 new apartments per year, only 295,300 were completed last year. Increased material prices, increased interest rates, ever new requirements from politicians: Because of these influencing factors, real estate associations are expecting further declines in the direction of just 200,000 new apartments for this and the coming year.
However, due to the high immigration figures, the need has increased compared to the target number from the coalition agreement. Last year, the number of inhabitants in Germany grew by around 1.1 million.
For a long time, little happened politically against the housing shortage, which mainly exists in the cities. But now Federal Building Minister Klara Geywitz (SPD) is making a move. In the Growth Opportunities Act, which Finance Minister Christian Lindner (FDP) is planning, she wants to establish better depreciation options for housing construction. “If the German economy wants to get back on course for growth, this will only be possible with strong construction activity,” she says.
For residential buildings for which the planning application is submitted between January 1, 2024 and December 31, 2030, the owners should be able to write off 7 percent of the construction costs in the year of completion and in the following three years. 5 percent is planned for the four years after that, and 2 percent for the following 26 years. This emerges from a paper by the ministry, which is also available to the FAZ.
More depreciation for energy efficiency
Tax incentives for companies that invest in better energy efficiency are planned in the Growth Opportunities Act. Geywitz would like to see that expanded. Contrary to what has been the case recently, the improved depreciation options should not be linked to strict climate protection standards.
The previous measures, such as increasing the linear depreciation options and reintroducing special depreciation, were not sufficient “to create sufficient investments for the urgently needed new apartments,” the paper says. A degressive depreciation, as depreciation is abbreviated in technical jargon, could make the new building more attractive.
Plans addressed to landlords
The plans are not aimed at people who want to build the classic single-family home. There is home ownership funding, for which the Budget Committee recently released additional funding. Those who generate income from their properties by renting or leasing them primarily benefit from the depreciation options.
The term AfA stands for depreciation for wear and tear. Last year, the traffic light coalition had already turned the screws for the first time. With the Annual Tax Act 2022, linear depreciation rose from 2 to 3 percent at the beginning of this year.
In addition, a special depreciation of 5 percent was introduced in the first four years if the new apartments are built according to the KfW Efficiency House 40 standard – whereby a quality seal is also required for sustainable buildings and a building cost ceiling of 4800 euros per square meter is observed must. These are “demanding conditions,” writes the Ministry of Construction.
Expect lower tax revenues
Geywitz is dependent on support from the Ministry of Finance for her project. It is true that such a program does not have to be budgeted for in the federal budget. But better depreciation opportunities lead to less tax revenue – which must be offset either by higher revenue or, failing that, by savings elsewhere. A request to the Ministry of Finance as to whether Lindner supports Geywitz’s plans has so far remained unanswered.
The associations of the housing industry reacted with satisfaction, if not enthusiastically. “We welcome this urgently needed step to stimulate new construction in Germany again,” said Axel Gedaschko, President of the Association of German Housing Companies (GdW). In view of the “dramatic overall situation”, however, additional measures are necessary.
Many housing companies simply do not have enough money to build. “An equivalent investment subsidy scheme must be made possible for these companies.” In addition, a special write-off is required for those companies that guarantee affordable rents. Andreas Mattner, President of the Central Real Estate Committee (ZIA), called for an overall concept. “It is important to reduce the state-related costs at Gut Wohnen from the current 37 percent – for example by suspending the real estate transfer tax for rental apartments or by dispensing with municipal levy models for project development.”
Hardly any more affordable new housing
In an analysis presented at the beginning of July, the GdW assumes that the average construction costs in tight housing markets will increase from 3000 euros per square meter in mid-2021 to up to 4500 euros this year, not including the land costs. While two years ago, new apartments could have been rented at a rent of EUR 10.95 per month, an average of EUR 18.10 is now required. But hardly anyone looking for an apartment could pay for this.
Dyrk Scherff Published/Updated: , Recommendations: 10 Julia Löhr Published/Updated: , Recommendations: 18 Jan Hauser Published/Updated: , Recommendations: 25 Falk Heunemann Published/Updated: ,
The high demand and the insufficient supply have recently also pulled up the rents for existing apartments significantly. According to data from the analysis company Empirica, new lease rents in the seven largest German cities recently averaged EUR 13.95. Compared to the same quarter of the previous year, this was an increase of almost 10 percent.
#Klara #Geywitz #sets #incentives