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Wohngeld: How people in Germany can get help with rising living costs

Many households in Germany could be eligible for increased financial support with their rents and bills from next year. We break down who should apply and how much help they could receive.

Euro notes lie next to some house keys on a table.
Euro notes lie next to some house keys on a table. Photo: picture alliance/dpa/dpa-tmn | Andrea Warnecke

The cost of living is rising across the board, and nowhere is this being felt more than in the home. For over a year, gas and electricity bills have been soaring and people on low incomes have been left wondering how to make ends meet.

While there is support available for people in this situation, it seems that many households in Germany aren’t aware that they could be eligible to apply for Wohngeld, or housing allowance, to help them with their expenses. What’s more, the amount of money people can get is set to rise at the start of next year.

Here’s what you need to know.

What exactly is Wohngeld?

Wohngeld, or housing allowance, is a form of financial aid for low-income households in Germany. It’s intended to help with the general costs associated with housing, such as monthly rents and utility bills.

Even people who own their own homes are able to get support with their mortgage repayments and building management costs (known as Hausgeld). However, they do have to fulfil certain criteria, like earning under a certain amount per month.

Unlike long-term unemployment benefit, which also includes a stipend for rent and bills, Wohngeld is intended for people who don’t rely on any other form of state support. That could include single parents or people with minimum wage jobs who spend a large proportion of their income on rent.

It means that people on jobseekers’ allowance and students with state loans and grants aren’t able to apply for Wohngeld. 

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How much money can people receive?

That depends on a range of factors such as where you live, how high your rent is and how much money you earn this month. However, one thing that’s clear is that Wohngeld is likely to rise significantly at the start of next year.

On Wednesday, cabinet ministers voted through proposals from Housing Minister Klara Geywitz (SPD) to hike the monthly allowance by around €190 on average. That means that instead of receiving €177 per month, the average household on Wohngeld will receive around €370 per month starting in January. 

It’s worth noting that Geywitz’s reforms still need to clear a vote in the Bundestag, but with the governing coalition of the SPD, Greens and FDP behind the move, it’s likely that they will. 

The Housing Ministry has also put together an online tool that can calculate the amount of Wohngeld each household is entitled to. At the moment, this still calculates the allowance based on the current rates – but it will be updated if the reforms are passed by parliament. 

Who’s eligible for Wohngeld?

That depends on a complex calculation based on factors such as income, the number of people in a household, the size and location of the property and how high monthly housing expenses are. There’s no straightforward income threshold that people can refer to, which could explain why thousands of households who could potentially get Wohngeld never apply for it.

The best way to check if you’re currently eligible is to use the government’s Wohngeld calculator tool. But as we mentioned above, this is still based on the current criteria and monthly rates. 

As well as hiking the monthly allowance, Geywitz also wants to expand the criteria so more households are eligible for Wohngeld.

At the moment, around 600,000 households in Germany receive Wohngeld. This could increase by 1.4 million to two million under Geywitz’s plans. From next year, people earning minimum wage and people on low pensions are set to be among those who are able to apply. 

READ ALSO: EXPLAINED: When should I turn on my heating in Germany this year?

Sound good – where do I sign up?

In general, the states and municipalities are responsible for handling Wohngeld applications. That means you should apply at the local Wohngeldamt (housing allowance office), Wohnungsamt (housing office) or Bürgeramt (citizens’ office) in your district or city. 

If you’re unsure where to go, searching for ‘Wohngeld beantragen’ (apply for housing allowance) and the name of your city or area should pull up some search results that can guide you further. 

Apartment blocks in Berlin Marzahn.

Apartment blocks in Berlin Marzahn. Photo: picture alliance / Matthias Balk/dpa | Matthias Balk

Alongside an application form, you’ll likely have to submit a tenancy agreement, ID, information on your residence rights and proof of any income or state support you already receive. Other members of your household may also have to submit similar financial information. 

You should also be registered at the address you’re applying for Wohngeld for. 

READ ALSO: Germany to spend €200 billion to cap soaring energy costs

Are there any other changes to Wohngeld I should know about?

Anyone already on Wohngeld, or who receives it between September and December this year, is also entitled to a special heating allowance to help with winter energy costs. This is also set to be given to students and trainees receiving a BAföG loan or grant.

For students and trainees, the heating allowance is set at €345 per person. Meanwhile, the amount given to Wohngeld recipients will vary on the size of the household.

Single-person households will receive €415, two-person households will get €540 and there will be an additional €100 per person for larger households. 

This is likely to paid out in January. 

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HOUSING

Is there any hope for Berlin’s strained rental market?

Rents in Germany’s capital city have more than doubled in the last decade, according to a recent report from Investment Bank Berlin. What keeps pushing up prices, and is the trend set to continue?

Is there any hope for Berlin’s strained rental market?

According to Investment Bank Berlin’s 2023 housing market report, published earlier this month, found rent prices, excluding utilities, rose from €5.75 per square metre in 2014 to €13.99 per square metre in 2023. 

The average asking rent prices leapt to €19.85 per square metre for newly built flats. 

READ ALSO: ‘Tense housing situation’: Why a Berlin renter can’t be evicted for two years

Tale of ‘two housing markets’

Dr. Hinrich Holm, chairman of the Board of Investment Bank Berlin (IBB), said in the report the current state of Berlin’s housing market reveals a challenging situation for renters. 

“Berlin basically has two housing markets,” he said.  “One with moderate prices for existing rental agreements and one with high rents on offer. We must therefore expand the range and at the same time offer apartments subject to rent and occupancy in order to provide low-income population groups with social housing.”

The sharp rise in Berlin’s population after war-related refugee migration and the end of the pandemic isolation rules is partially to blame, he added. Nearly 80,000 people moved to Berlin after the start of Russia’s war in Ukraine in February 2022. 

Construction unlikely to solve Berlin apartment shortage

Construction for new builds is back in swing and has reached the levels seen in the mid-1990s after the wall fell. 

For the first time building completions exceeded the number of building permits issued. That amounted to the completion of 17,310 apartments which is 1,400 more than in 2021.  

Christian Gaebler, Senator for Urban Development, Building and Housing, said new construction could not immediately solve Berlin’s apartment shortage. 

Luxury flats in Berlin

Central Berlin apartments. Photo: picture alliance/dpa | Christophe Gateau

“Housing construction is not meeting demand at the moment,” he said. “The causes are complex: rising land and construction costs, delivery bottlenecks, a shortage of skilled workers and also the development of interest rates.”

With a construction backlog of more than 62,000 apartments and a realisation rate of 86.5 percent, it is predicted that the majority of apartments will become available over the next few years. But that will not help those in the market for an apartment today. 

READ ALSO: Why does Germany keep missing its house building targets?

Berlin housing crunch increases competition

Molly Harison, an American English teacher in Berlin, found her current apartment through the website wg-gesucht. She said it was tough to find reasonably priced apartments within The Ring — what Berliners dub the part of the city encircled by the S-Bahn — and avoid potentially predatory renting situations during her search. 

“With all of the expats and foreigners that are moving here, rent is really high, unless you find a questionable living situation or an honest person,” Harison told The Local. “The amount of people I know who are renting out rooms in their apartment, and the person in the apartment is paying the majority of the rent is wild.”

Harison said competition was fierce to find her current living situation.  

“There’s just not a lot of long-term rental contracts because as soon as they’re up someone snatches them and they’re gone,” Harison said. 

“There were days where I’d try to go on and find things it would be like as soon as I had messaged three people, those same ads from those three people would be gone because someone else had already put the deposit down.”

Lucy, an Italian digital marketer who moved to Berlin in March to start a new job, agreed. 

“I definitely needed to be consistent with my search, I checked the posts twice a day and sent a lot of messages,” she told The Local. “It helped me to be one of the first people to send a message to the landlord, like as soon as they posted the offer.” 

Lucy said this method paired with some knowledge of German helped her find a place within her budget in just under three weeks. 

Still, it can also be a struggle to find long term housing that offers Anmeldung, or official registration at a German residence, which is a requirement for long term visas and work permits.  

“It was quite hard to find a place that was legit for the Anmeldung, I’ve noticed that most of the time it’s not possible,” Lucy said. 

Anmeldung is required to open some bank accounts, get a tax identification number for work, and sign up for wifi in Germany. Legally residents are required to register their address within two weeks of moving.  

And housing issues in Berlin have spread outside of the city’s metro area. Nearby cities like Potsdam also recorded marked rises in asking rent prices as some commuters choose to move outside of Berlin’s city limits for housing.  

But while rents in Berlin have soared to record highs, housing prices for those looking to buy are not as bleak. The prices of condominiums and one and two family homes bucked the trend and declined slightly from previous years. 

Condominium prices stagnated for the first time since the survey began analysing Berlin housing data. 

In 2023, condominiums were advertised for an average of €5,746 per square metre. The median for new condominium buildings fell by 4.4 percent to just over €8,000 per square metre. 

The median home price also fell 9.5 percent to €639,000. 

READ ALSO: Why property prices are falling in almost all German cities

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