The German Real Estate Industry Association (BID) has expressed its concerns regarding the short-notice adjustment of KfW funding products within the framework of the Federal Funding for Efficient Buildings (BEG) programme. KfW had announced that new funding conditions for BEG heating subsidies, as well as for the systemic renovation of residential and non-residential buildings, would become valid from 21 July 2026.
A key point of criticism concerns the transition phase: until the new conditions come into force, no new confirmations for application (BzA) can be issued. However, these BzAs are a mandatory prerequisite for registering a funding project. Applications during the transition phase are only possible with an already existing valid BzA ID, with the deadline for this expiring at 8 PM on 20 July 2026.
Impact on funding and planning certainty
Dirk Wohltorf, Chairman of BID and President of the German Real Estate Association (IVD), described the situation as a 'bitter déjà vu' and referred to the KfW funding freeze in January 2022, which had significantly eroded trust at the time. He stressed that owners, companies, energy consultants and financiers are once again confronted with an abrupt change – without adequate prior warning and in the midst of ongoing planning.
BID fears a significant restriction of central funding components, including efficiency house standards, bonuses, and repayment subsidies. In particular, the planned reduction in eligible costs for efficiency measures in multi-family homes is considered serious: in future, only EUR 30,000 will be considered for the first residential unit, EUR 15,000 for the second to sixth residential unit, and from the seventh residential unit onwards, only EUR 8,000. This would mean that funding in large multi-family homes and entire housing stocks would largely lose its effectiveness, as support per dwelling for extensive modernisations would be significantly reduced.
- —Restriction of efficiency house standards.
- —Reduction of bonuses and repayment subsidies.
- —Significant reduction of eligible costs for multi-family homes.
- —Lack of planning certainty for construction and renovation projects.
For the real estate industry, the adjustment of BEG funding sends a system-critically negative signal. BID sees the planning certainty of construction and renovation projects, which are often planned over years and coordinated with various parties, as being jeopardised. Funding conditions are a cornerstone of financing. A reliable funding policy is crucial for housing construction and building renovation. The short-notice creation of new facts damages trust and slows down urgently needed investments.
BID calls on the German government to transparently explain the changes made, to effectively protect ongoing plans, and to ensure reliable transitional arrangements. It emphasises that the real estate industry is prepared to invest in new housing construction, renovation, and climate protection, but for this, it requires clear framework conditions and a cooperative policy that seeks dialogue with the industry before making decisions.
