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Frankfurt social housing - subsidized living

What Is Social Housing and How Is It Funded?

In Germany, social housing is the state-subsidized construction of apartments, especially for social groups who cannot meet their housing needs on the free housing market. In addition to the personal requirements that tenants must prove with the housing entitlement certificate, there is a maximum rent (“cost rent”), as regulated in the German Housing Binding Act (WoBindG).

The aim in social housing is to ensure that broad sections of the population are supplied with living space at affordable conditions. In order to get public funds approved, certain legally defined standards must be observed. There is no legal right to social housing. Brokers are not allowed to demand a commission from the tenant when brokering social housing, but they can from the landlord.

  • The first funding path (funding path 1) is used to finance social housing that is reserved for the lowest-income sections of the population.
  • The 2nd funding path (funding path 2) has been intended to offer help to those with a slightly higher income since 1966 who are able, for example, to free an inexpensive publicly subsidized apartment for the needy by building their own home or buying a condominium.
  • The 3rd funding route (funding route 3) is referred to as the so-called agreed funding. A certain apartment size and a future rent are agreed with the owner or builder of the apartment, which should not increase over an agreed period of time.

In Frankfurt, the 1st and 2nd funding paths are used regularly.

On January 1st, 2002, the Housing Promotion Act (in German: “Wohnraumförderungsgesetz“) came into force, which marks a turning point for social housing. The focus is no longer on promoting broad sections of the population, but only on needy households who cannot support themselves on the market and are dependent on support. In addition, the housing stock and the purchase of existing apartments are now also included in the funding.

In May 2020, the building land decision was passed, which defines binding quotas for the construction of residential units.

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