Saxony reorganizes promotion of home ownership

Saxony wants to provide more targeted support for families on the path to home ownership in future. This was announced by Infrastructure Minister Regina Kraushaar (CDU) after the cabinet meeting in Dresden. The support will be "more needs-oriented". This is also due to the fact that there is currently less money available than last year. In 2024, Saxony made around 135 million euros available for this purpose. A freeze on applications was imposed at the end of the year.

Around 34 million euros are available for 2025 and an estimated 55 million euros for 2026. "In view of the tight budget situation, the amount of funding had to be reduced. However, with the new funding concept, the same number of applications can still be approved," it said. As a rule, the subsidized loan should amount to 80,000 euros, last year the average was 135,000 euros. Low-income families or buyers of old buildings in particular are to benefit from additional interest rate discounts.

Applications for development loans can be submitted from August 10

From October 10, families can once again apply for state loans from the Sächsische Aufbaubank. Specifically, families will be supported with low-interest, long-term loans to create or acquire owner-occupied residential property. "In this way, the Free State is helping to make the desire to own their own four walls accessible to households with lower incomes," it said. "Our families should have the opportunity to create their own home," said Kraushaar.

The minister also sees this as a way of preventing poverty in old age. Home ownership is, after all, an important pillar of old-age security. "We have specifically developed the program further: It is now easier to use, it is completely digitalized, more socially equitable in terms of interest rates and, for the first time, open to communal housing projects." This is because housing projects in particular have become a popular form of home ownership in recent years.

As the family grows, the interest rate on the loan decreases

In concrete terms, the Family Housing Funding Guideline contains the following new regulations. For the first time, families who are part of a joint building and housing project can also benefit from the subsidy. The interest rate reduction also takes into account children who are born after moving into the property. If the family grows, the interest rate on the loan will fall. The previous living space limits no longer apply; only the total costs of the project are decisive. In future, an own contribution of ten percent will suffice.

The core of the "Family Living" program is low-cost development loans. They have a maximum term of 25 years and special repayments are possible. Only those who cannot finance the project with freely available assets and who live in the property themselves are eligible for subsidized financing. Income limits also apply. Interest rates depend on the number of children in the household. Interest rate reductions are also available if an old residential building is upgraded for energy efficiency or the household income is not so high.