In Hesse, an increased number of homes are granted housing subsidies. - More homes in Hesse receive rental assistance payments
In the state of Hesse, the number of households receiving housing allowance has seen a significant increase, with approximately 78,600 households benefiting from this support by the end of 2024. This trend is reflective of broader national and regional trends in Germany.
The persistent housing shortage in Germany, with the government falling short of its target to build 400,000 new homes annually, has contributed to the increase in housing allowance recipients. In 2023, only about 290,000 new dwellings were completed, and in 2024, housing permits dropped further by 43% compared to 2021, exacerbating the supply-demand gap to an estimated 600,000 dwellings.
Another factor influencing the rise in housing allowance recipients is the significant share of foreign residents relying on Bürgergeld, Germany's social welfare system that includes housing support. Migrant households, who constitute about 15% of the population, represent about 50% of Bürgergeld recipients due to their larger family sizes and higher housing costs.
The ongoing accommodation needs of protection seekers, particularly in major cities like Berlin and Hamburg, have also impacted housing allowances across various federal states, including Hesse. Despite a decrease in overall asylum applications, accommodation facilities for asylum seekers remain highly occupied.
The housing allowance increase in Hesse is also a response to economic uncertainties and housing cost inflation. The allowance is designed to cover rent, heating, operating costs, and deposits for low-income residents.
Interestingly, almost half of all households receiving housing support in Hesse in 2024 consisted of only one person. Moreover, over half of the households receiving housing allowance were occupied by pensioners. The average monthly housing allowance claim in Hesse was 332 euros in 2024, a decrease of nine euros compared to 2023.
It is important to note that the average age and income levels of households receiving housing allowance in Hesse were not specified in the provided information. Additionally, the reasons for the increase in the number of households receiving housing allowance were not explicitly stated.
The housing allowance in Hesse is determined by household size, income, eligible rent, loan installments, and operating costs for homeowners. Households receiving other state benefits such as unemployment benefit, social assistance, and BAföG for accommodation are generally not eligible for housing allowance in Hesse.
Without sufficient new housing construction or changes in policy, the trend of rising housing allowance demand and related fiscal burdens is likely to continue.
- To address the ongoing housing shortage and its impact on personal-finance, the government might consider implementing a community policy that prioritizes vocational training for construction workers, thereby increasing the number of new homes built annually and reducing the demand for housing allowance.
- As a significant proportion of households receiving housing allowance in Hesse are pensioners, offering vocational training programs in financial management or personal-finance could help these individuals better manage their money and potentially reduce their reliance on housing allowance.
