Berlin to offer loans and grants to hard-up tenants after rent cap defeat

The Berlin government says it will set aside millions of euros in aid and loans to help tenants struggling after the Mietendeckel was overturned.

Berlin to offer loans and grants to hard-up tenants after rent cap defeat
People demonstrating against the Mietendeckel defeat in Berlin. Photo: DPA

Tens of thousands of Berliners affected have been hit with hikes to their rent after the rental cap was ruled void by the federal constitutional court last week.

Many people are also facing back payments from landlords and private housing companies.

On Tuesday the Berlin Senate announced they would help tenants who had not saved the money to pay landlords back, or were struggling with their new rent increase.

According to the government, 365,000 residents in Berlin were temporarily entitled to a rent reduction until the court ruling last week.

Of these, the Senate estimates that 40,000 households may struggle to pay back the differences in the months they paid the temporary lower rent.

In extreme cases, people could be threatened with eviction, the local government said – and the hardship fund will apply to these households who need it most.

Some Berliners’ rents were lowered when the second stage of the rent cap came into force on November 23rd 2020, while others are tenants who have signed so-called ‘shadow tenancy agreements’ which included two rents in the contract. 


So what help can people get?

The amount of money that people can get depends on their income.

The local government in a press release said the loans “must be repaid and are granted interest-free. If tenants are unable to repay all or part of the money through no fault of their own, the loan can be converted into a grant and its repayment (partially) waived.”

Tenants who are not on housing benefits and who have not set aside the “saved” rent payments will therefore have the opportunity to receive bridging assistance.

All households whose income is up to 280 percent of the federal income limit are eligible. The annual federal income limit for a one-person household is currently €12,000 per year.

It means that under Berlin’s rent protection fund, single-person households with an income of up to €33,600 per year are eligible.

People who are on benefits should contact their district office to check whether the landlord’s additional demands can be met with housing benefit.

The Berlin Senate plans to commission the Investitionsbank Berlin (IBB) to pay out the loans.

Tenants will be required to submit information to prove their situation, including their lease and proof of rent payment for the last three months.

Funds could be in accounts as early as May 1st.

However, it is a matter of “bridging liquidity, which is only converted into grants in cases of hardship”, said housing senator Sebastian Scheel emphasising that the government prefers to offer loans rather than grants.

The rent cover fund will include €10 million to help tenants.

Some private landlords have announced they will waive repayments for tenants. Berlin state-owned housing companies are also not demanding the money back.

Others, such as Deutsche Wohnen, Berlin’s biggest private housing firm, said they will demand repayments.

Scheel said: “Some landlords have already announced that they will waive repayments or offer deferments. I appeal to all landlords to follow this path. It is self-evident that the state-owned housing societies do not charge back.”

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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.

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

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. 


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.