Housing allowance to rise by an average of 30 euros
On January 1st, the housing allowance is set to increase by an average of 30 euros. The corresponding regulation was approved by the Federal Cabinet, as announced by the Federal Ministry of Housing in Berlin. It still needs the approval of the Bundesrat.
The monthly rent subsidy for citizens with low incomes is reviewed every two years to ensure it is adequately adjusted to changes in prices and rent, as required by law. The ministry had already announced the expected average increase in July.
Federal Minister of Housing Klara Geywitz stated: "People are spending significantly more on rent, energy, and daily necessities today. To maintain the relief effect in the long term, we are increasing the monthly housing allowance by an average of 15 percent, or 30 euros, as of January 1, 2025."
The last reform took place in 2023, when the circle of eligible recipients was also significantly expanded. The goal of the housing allowance is to relieve workers and pensioners with low incomes so that they do not have to apply for unemployment benefits or basic security due to high rents. The amount of the housing allowance depends on the number of household members, income, and rent. The ministry previously estimated that around 1.9 million households nationwide could receive housing allowance next year.
Other eligible recipients might benefit from the expanded circle, enhancing their living conditions. The need for such changes in the housing allowance system is evident, as other cost factors like utilities and groceries also continue to rise.
