Energy Renovation in Germany 2026: Duties, Costs and Funding Explained

What applies today: the Building Energy Act

The law that counts is the GEG (Building Energy Act) in its current version. This is the law from 8 August 2020 that contains the much-debated heating rules from 2024, most recently amended in June 2026. It brings together the requirements for new builds, insulation, building systems and heating in one place.

For you, that means: as long as the reform has not been promulgated, your obligations and the requirements for a new heating system follow this law. Much of what the media currently calls "the new heating law" describes a draft, not the law that is actually in force.

The 65 percent rule: who it affects and from when

The best-known requirement is the rule that a newly installed heating system has to run on at least 65 percent renewable energy. It does not apply everywhere at once, though; it is staggered by location and date.

• New builds in new development areas: here the 65 percent rule has been mandatory since 1 January 2024.
• Existing buildings: here the rule is tied to municipal heat planning and only takes effect after fixed cut-off dates.
• Large cities with more than 100,000 residents: the deadline was pushed from 1 July 2026 to 1 November 2026 by a separate transitional law.
• Smaller municipalities up to 100,000 residents: for them the date is 30 June 2028.

Up to the relevant cut-off date, you may still install a new gas or oil heating system. All that is required in that case is a mandatory consultation that points out the rising costs of fossil fuels and possible follow-up obligations.

Municipal heat planning and what it means for you

Whether and when the 65 percent rule applies to your existing building is decided through municipal heat planning. The deadlines for that run in parallel with the heating deadlines: cities over 100,000 residents have to present their heat plan by 30 June 2026, smaller municipalities by 30 June 2028. What counts for the classification is the population as of the cut-off date of 1 January 2024.

One clarification that often gets lost is important here: an adopted heat plan does not automatically bring the 65 percent rule into force early across the board. The cut-off dates named above remain in place as fallback dates. A heat plan can, however, trigger the obligation locally, usually about a month after it is announced, for example when a heat network or a hydrogen network is specifically designated for your neighbourhood. To find out what applies in your area, ask your town or municipality.

The Building Modernisation Act (GModG): what is planned

The actual reform is called the GModG (Building Modernisation Act, still a draft), sometimes abbreviated GMG. So far it is a draft and is before the Bundestag. The path so far: the cabinet approved the draft in May 2026 (13 May), the first reading in the Bundestag took place on 11 June 2026, and the public hearing in the economic affairs committee on 22 June 2026. The second and third readings, along with the final passage through the Bundesrat, are still outstanding. There is no fixed date for it to enter into force. The date named most often is 1 November 2026, and it is expected to take effect in stages.

According to the draft, the GModG is meant, among other things, to scrap the blanket 65 percent obligation (Section 71) and the 30-year replacement obligation for old boilers (Section 72). In their place there would probably be a so-called "bio staircase" from 2029, meaning a slowly rising minimum share of renewable energy rather than a fixed quota from day one. On top of that would come the requirements from the European buildings directive, such as a zero-emission standard for new builds in 2028 and 2030.

What does not change for you

For all the debate about heating obligations, much stays stable, and that is the good news for your planning. The funding programmes continue in 2026: the KfW heating subsidy, single-measure funding through the BAFA, and the KfW Effizienzhaus funding. The exact rates are not guaranteed for years, though, and budgets are tight, so it pays to apply early. The best way to check what funding you are currently entitled to is directly in the KfW funding finder.

The overarching goal also stays the same: Germany is set to become climate-neutral by 2045, and the reform does not change that. And one more point that is often misunderstood: the planned changes make the Wärmepumpe (heat pump) more attractive, not less. Above all, the reform loosens rigid obligations and deadlines, while the trend toward electricity-based, renewable heat and rising prices for fossil fuels remains. If you invest today in a well-insulated building envelope and a Wärmepumpe, you will be in a good position even after a possible reform.

Retrofit obligations for insulation

The first obligation concerns the roof. Under Section 47 GEG, you have to insulate the top-floor ceiling, meaning the ceiling that faces the unheated attic. Alternatively, you can insulate the roof above it. In both cases, the target is a U-value of no more than 0.24 W/(m²K). This obligation is nothing new: the general deadline for it already passed at the end of 2015. So if you still have not met it, you are behind, unless an exemption applies.

The second obligation is far cheaper and often done in a couple of hours. Under Section 69 GEG, accessible heating and hot-water pipes and fittings in unheated rooms have to be insulated, typically in the basement. It costs little but saves energy right away, because warm pipes running through a cold basement otherwise give off heat that nobody uses.

Replacement obligation for old boilers

Under Section 72 GEG, oil and gas constant-temperature boilers cannot keep running indefinitely. The rule of thumb: if a boiler like this is more than 30 years old, it has to go. For units installed before 1 January 1991, running them is no longer permitted at all. For newer systems, the count is the year of installation plus 30 years.

What matters is the boiler technology, not simply the age. The more modern low-temperature and condensing boilers, which make up most of today's existing heating systems, are exempt from the replacement obligation. Also exempt are very small systems under 4 kW and very large ones over 400 kW of rated output. To find out whether your boiler is affected at all, check the type plate or your chimney sweep's inspection record.

Special case of purchase and inheritance: the 2-year deadline

The owner-occupier exemption ends when ownership changes hands. If you buy or inherit an older house, you take on the open obligations and have to meet them within two years of the entry in the land register. This covers all three points mentioned above: insulating the top-floor ceiling (Section 47), insulating the heating pipes (Section 69), and decommissioning an old constant-temperature boiler (Section 72).

Plan for this deadline from the start when you buy, because it can trigger an investment that was not even on your list in the first year after moving in. A look at the energy certificate and the chimney sweep's record before the purchase shows you early on what is coming your way. There is one exception: for multi-family buildings and condominium ownership (WEG), the 2-year deadline does not apply.

Fines and enforcement

If you ignore these obligations, you risk a fine. Under Section 108 GEG, the legal maximum runs up to 50,000 €, though in practice the amounts set are usually much lower. Treat this figure as a reference ceiling: the actual amount depends on the individual case and the specific violation.

Enforcement mainly happens through the chimney sweep. During their regular visits, they check things like the age and type of your heating and point out any existing replacement obligation. So in most cases this is not about a penalty but a clear heads-up about which measure is due and by when.

Why insulating before swapping the heating saves real money

An insulated envelope lowers your home's heating load. And that load is exactly what determines how big your new heating system needs to be. In a well-insulated house, a smaller and therefore cheaper Wärmepumpe (heat pump) is enough. It has to deliver less output, gets by with a lower flow temperature, and works more efficiently as a result.

The key figure here is the seasonal coefficient of performance (SCOP, or in German the Jahresarbeitszahl, JAZ). It tells you how many kilowatt-hours of heat the heat pump produces from one kilowatt-hour of electricity. The lower the flow temperature, the higher the SCOP and the less electricity you use in operation. If you instead install the heat pump first in an uninsulated house, you size it for the old, high heating load. It becomes more expensive to buy, runs inefficiently at a high flow temperature, and you pay for that mistake every winter through your electricity bill.

• An insulated envelope lowers the heating load, so the heat pump can be smaller.
• A smaller system means lower upfront costs.
• A low flow temperature raises the seasonal coefficient of performance and cuts your electricity costs.

The individual renovation roadmap (iSFP) as your compass

So you do not set the order by gut feeling, there is the iSFP (individual renovation roadmap). A certified energy efficiency expert looks at your house and defines which measure makes sense in which order. It is your compass for the years ahead and, as of July 2026, also a financial lever.

According to BAFA, the consultation is subsidized at 50%, capped at 650 € for a single-family house and 850 € for a multi-family house (from three residential units). The finished plan is valid for 15 years, so you can spread your renovation calmly over many years.

Common mistakes and structural damage

A renovation rarely goes wrong on the big picture; it goes wrong in the details. Three mistakes come up again and again:

• Partial insulation and thermal bridges: If you insulate only the facade but leave out the cold plinth or the window reveal, you create spots where heat escapes in a concentrated way and the interior wall stays cold. That is exactly where damp appears later.
• Forgetting ventilation: New, airtight windows do not just keep the cold out, they also keep the moisture in. Without adjusted ventilation habits or a ventilation system, humidity builds up in the room.
• Insulating over damp substance: If you insulate over an already wet wall, you simply seal the moisture in instead of getting rid of it.

Roof and top-floor ceiling

A lot of heat escapes through the roof of an old house, and insulating the roof saves around 13 % of your heating energy. There are three routes: between-rafter insulation from the inside (55 to 150 €/m², the cheapest method for a finished loft), under-rafter insulation as an add-on (30 to 80 €/m²) and over-rafter insulation from the outside including a new covering (120 to 350 €/m²). Over-rafter is the most expensive, but it insulates the roof without gaps or thermal bridges and pays off above all when the roof needs re-covering anyway.

If you do not use the loft as living space, insulating the top-floor ceiling is often the smartest first measure: 20 to 35 €/m² for a non-walkable finish, from about 3,000 € in total, frequently a DIY job and usually paid off in under ten years. For many houses this insulation is a legal requirement anyway.

Facade (external insulation systems and alternatives)

The external walls are the largest single surface of your house, so the impact is correspondingly high: an insulated facade saves around 19 % of your heating energy. The most common approach is an external thermal insulation composite system (WDVS), where insulation boards are bonded to the wall and rendered. It costs 120 to 350 €/m², usually 20,000 to 30,000 € net for a detached house. Grey EPS insulation is the cheapest (135 to 165 €/m²), non-combustible mineral wool is a little dearer (155 to 200 €/m²).

There are alternatives: the rear-ventilated curtain facade (visually high-end, but pricier), cavity-fill insulation blown into double-skin masonry (very cheap if there is an air gap) and internal insulation, for cases where the facade must not be altered, such as timber-framed or listed buildings. Internal insulation is demanding in terms of building physics and belongs in the hands of a specialist firm.

Basement ceiling: often the cheapest measure

If your basement is unheated, insulating the basement ceiling almost always pays off as the first step. Insulation boards are fixed to the underside of the ceiling, which costs 22 to 66 €/m², and the material for a DIY fit is only 10 to 20 €/m². The savings come to around 5 %, and with a payback of 3 to 8 years it is the measure with the fastest return. As a pleasant side effect, the cold feet on the ground floor are gone.

Windows and front door

Modern triple glazing saves up to 15 % of your heating energy. Per window you pay 500 to 1,400 € depending on the material, with PVC the cheapest and wood-aluminium the most expensive, plus 150 to 500 € for the reveal. For 15 to 20 windows in a detached house you end up at 15,000 to 30,000 €. Important: new, airtight windows change how moisture behaves in the house, so afterwards you need to ventilate more deliberately or consider a ventilation system.

An insulated front door comes to 1,800 to 7,500 €, with 2,000 to 5,000 € being typical. It qualifies for BAFA funding if its thermal transmittance (Ud value) is no higher than 1.3 W/(m²K).

Heating: heat pump, pellets, hybrid, district heating

The air-to-water heat pump (Wärmepumpe, heat pump) is the most common choice in existing buildings. Watch the numbers here: the unit alone costs 8,000 to 16,000 €, while the complete system fully installed comes to around 27,000 to 40,000 €. That total price includes installation, the hydraulics and often the removal of the old oil tank. With a well-insulated shell and your own PV, you can cut heating costs by 40 to 60 %. A brine or ground-source heat pump is usually even more efficient, but with drilling it costs around 30,000 to 50,000 €.

Alternatives are the pellet heating system (28,000 to 35,000 €, fuel 350 to 450 €/t, though it needs a storage room), the gas hybrid system (21,000 to 50,000 €, where the gas boiler only kicks in at peak demand) and the district heating connection (5,000 to 20,000 € one-off, provided a network runs past your house). Which technology suits your house depends heavily on the state of the insulation and local conditions.

The heat pump is the future-proof route for most houses, so it is worth a close look at the technology, the seasonal performance factor (SPF) and the costs. You will find all the details in the in-depth guide Heat pump costs 2026.

Ventilation with heat recovery

The tighter your house is after the renovation, the more important controlled air exchange becomes, otherwise moisture builds up and you risk mould. A ventilation system with heat recovery returns 80 to 90 % of the heat from the extracted air back into the fresh air. A central system costs 12,000 to 25,000 €, decentralised units per room 4,000 to 8,000 €, and it saves 300 to 800 € per year. It makes particular sense in heavily insulated, airtight houses.

Photovoltaics and solar thermal

Photovoltaics pair perfectly with a heat pump, because your own solar power pushes heating costs down further. A system costs around 1,015 €/kWp (as of March 2026), and no VAT applies to the purchase (0 %). Depending on size you land at 5,400 to 20,000 €, or 13,000 to 23,000 € with a 10 kWh battery. Payback runs to 8 to 12 years.

Solar thermal, by contrast, uses the sun directly for hot water or to support your heating. A system just for hot water costs 5,000 to 6,000 €, a combined system that also supports the heating 8,000 to 15,000 €, with savings of 200 to 700 € per year.

KfW 458: heating subsidy of up to 70 percent

For replacing your heating system, above all moving away from oil and gas and switching to a Wärmepumpe (heat pump), there is a direct grant through KfW 458. The clever part is the bonuses, which can be stacked on top of each other. In the end, though, there is a hard cap at 70 percent, no matter how many bonuses you add up.

In concrete terms: in a single-family home, 30,000 € is eligible, and in the best case you get 70 percent of that, so up to 21,000 € as a grant. As of July 2026, per BAFA/KfW.

BEG individual measures through the BAFA

Everything to do with the building envelope and building services, meaning insulation, windows, ventilation or heating optimization, runs through the BAFA. Here you get a 15 percent base subsidy, and with an individual renovation roadmap (iSFP) you add 5 percentage points. At the same time, the iSFP doubles your funding cap, and that is the real lever.

So the iSFP pays off twice over: 5 percentage points more in grants and a ceiling that doubles from 30,000 to 60,000 € per residential unit and year. As of July 2026, per BAFA/KfW.

KfW 261: full renovation to Effizienzhaus level

If you bring your house up to an Effizienzhaus (efficiency house) standard in one go, you use KfW 261. This is a low-interest loan with a repayment grant that simply cancels part of the loan. The better the Effizienzhaus level you reach, the higher the grant.

The loan runs up to 120,000 € per residential unit, or up to 150,000 € with an EE or NH class. One thing to note for 2026: the budget for this program has been slashed to roughly 2 billion €, a drop of about 58 percent compared to 2025. There is no application freeze at the time of writing, but the pot can run dry over the course of the year. So if you are planning a full renovation, apply early. As of July 2026, per BAFA/KfW.

Tax credit under Section 35c EStG: the no-application alternative

There is a second route that skips the funding application entirely: the tax reduction under Section 35c EStG (Income Tax Act). You deduct your renovation costs directly from your tax liability over three years. No portal, no grant notice, just an entry in your tax return plus a certificate from your specialist contractor.

The most important catch: it is an either-or. Even a partial subsidy through KfW or BAFA for a single, unified measure rules out Section 35c completely for exactly that measure. If you have several separate measures on the house, though, you may choose a different route for each one. As of July 2026, per BAFA/KfW.

Special cases: listed buildings and landlords

Two situations run outside the usual programs. If you renovate a listed building, or if you rent out rather than live in the property yourself, you have your own rules, and they are worth knowing.

As a landlord you cannot use the Section 35c tax credit, since it only applies to owner-occupied homes. What you do keep is the modernization rent increase and the BEG grants. As of July 2026, per BAFA/KfW.

Apply before you order, and the 2026 budget note

To make sure nothing goes wrong, stick to a fixed sequence. It applies to every grant program the same way:

• Energy consultation and iSFP: record the current state, set the order of measures, unlock the bonus.
• Submit the funding application in the right portal (BAFA for the envelope, KfW for the heating or the full renovation).
• Wait for the funding approval or grant notice.
• Award the contract and carry out the work.
• Submit proof of use, then the payout follows.

For your longer-term planning, an honest assessment: the programs are expected to continue until at least 2029, but that is not set in stone. Foreseeable adjustments are being discussed, such as a higher income threshold from around 2027, and the climate speed bonus is scheduled to shrink from 2029. The cut KfW 261 budget also shows that conditions are shifting. Realistically, you can only plan reliably on today's rates through the end of 2026. So if you are renovating, you are better off locking in your funding now rather than waiting for better terms. As of July 2026, per BAFA/KfW.

Example A: Full renovation in one campaign

The owners do everything in one go: insulate the building envelope, replace the windows, rip out the oil heating, put in a Wärmepumpe (heat pump), and add solar PV with a battery. Here is what the gross costs look like:

Now the subsidies, and here is the most important misconception many people fall for: the building envelope and the heating are funded through two separate pots, never through the same pot for the same measure.

• Envelope through BAFA (BEG individual measures): facade, roof, and windows together come to 55,000 €. With an iSFP (individual renovation roadmap), the doubled cap of 60,000 € per residential unit per year applies, so all 55,000 € are eligible. 15 % base funding plus a 5 % iSFP bonus makes 20 %, which is around 11,000 €.
• Wärmepumpe through KfW 458: the eligible cost base is capped at 30,000 €. 30 % base funding, a 20 % climate speed bonus, and, if the heat pump qualifies for the efficiency bonus, another 5 % add up to 55 %, so around 16,500 €. With the income bonus (taxable household income up to 40,000 €), the rate rises to the cap of 70 %, then up to 21,000 €.
• Solar PV: no BEG grant, but 0 % VAT and the feed-in tariff.

Together that is around 27,500 € in subsidies (about 32,000 € with the income bonus). That brings the net cost down to around 79,500 € (roughly 75,000 € with the income bonus).

And what does it do for running costs?

• Heating costs: from around 3,920 € down to about 700 € a year. The insulated envelope cuts the heat demand, and the heat pump runs with a seasonal performance factor of around 3.7. That saves roughly 3,200 € a year, plus the solar PV adds a benefit of roughly 1,200 € a year.
• CO2: from around 7.5 tonnes to under 1 tonne, so roughly 90 % less.
• Payback: 79,500 € divided by around 4,400 € saved per year works out to roughly 18 years. In reality it is shorter, because the CO2 price on heating oil keeps rising (around 55 to 65 € per tonne in 2026, and from 2028 likely much higher under the European emissions trading scheme) and costs for the oil tank, chimney sweep, and boiler servicing disappear.

Example B: Step by step over five years with an iSFP

The trick: the doubled BAFA cap of 60,000 € and the 5 % iSFP bonus apply per residential unit per calendar year. If you do everything in one year, you hit the limit fast. If you spread the envelope work across several years, you tap the cap fresh year after year. And the heat pump deliberately comes only once the envelope is insulated: the heating load is then smaller, so the Wärmepumpe can be smaller and cheaper and runs with a higher performance factor.

In years 1 and 2, the BAFA subsidy of 20 % applies each time (15 % base plus a 5 % iSFP bonus). In year 3, the heat pump runs through KfW 458 at 55 %, and with the income bonus up to 21,000 € would be possible. The solar PV in year 4 gets no BEG grant but benefits from the zero VAT rate.

The bottom line: Example B lands at the same roughly 107,000 € gross and around 27,500 € in subsidies, plus the 650 € iSFP grant. The result is identical, just more predictable: you never pay more than one year's amount at a time and you keep an overview at every step. In both versions, two things stay important: never combine BAFA and KfW for the same measure, and count on the iSFP bonus per measure only once within any 15-year period.

Payback: 15 to 20 years, often shorter in practice

If you count only the energy you save against your out-of-pocket share, a typical unrenovated single-family home from the 1970s quickly lands at 15 to 20 years. An example: if roughly €79,500 is left as your own share after subsidies and you save around €4,400 in energy costs per year, that works out to about 18 years on paper.

But that number is deliberately conservative. In practice the payback comes sooner, because two things get added in. The CO2 price makes fossil heating more expensive year after year, and switching to a Wärmepumpe (heat pump) removes running costs that the pure energy math often overlooks, such as the annual chimney-sweep and boiler service, the oil-tank inspection, and eventually the cost of removing the tank.

Value increase: real, but heavily location-dependent

An energy renovation usually raises a property's value. By how much can only be estimated responsibly. Market studies cite an average increase of around 23 percent. Moving from a poor efficiency class (F, G, or H) up to Effizienzhaus level can, depending on location, lift the value by 30 to nearly 50 percent.

The CO2 price makes fossil heating more expensive

If you keep heating with oil or gas, you pay a growing surcharge. As of 2026, the national CO2 price sits at roughly €55 to €65 per tonne. An unrenovated oil-heated house easily emits 7 to 8 tonnes of CO2 a year, which already means several hundred euros just for the CO2 portion.

From 2028, the price is expected to be set through the European emissions trading scheme (EU-ETS 2) and is likely to rise noticeably. Exact figures are not yet fixed; the range under discussion sits well above today's level. For you, that means the gap between fossil heating and an efficient Wärmepumpe (heat pump) grows wider every year, not narrower.

What you cannot measure in euros

Part of the benefit shows up in no payback calculation, yet you notice it quickly in daily life:

• Comfort: warm interior walls instead of cold floors, even temperatures, no draughts from old windows, quieter rooms.
• Independence: less exposure to volatile oil and gas prices and to political price shocks.
• Planning certainty: renovating today under the current rules leaves you ready for coming obligations and a rising CO2 price, so you avoid expensive last-minute upgrades under time pressure.
• Healthier indoor climate: a properly insulated building envelope with the right ventilation lowers the risk of mould rather than raising it.

Is the new heating law already in force in 2026?

No. As of July 2026, the GEG (Building Energy Act) still applies in its current form, including the heating rules from 2024. The reform bill, the GModG (Building Modernisation Act), is still going through the Bundestag and has not taken effect. According to the draft, it is expected to apply from 1 November 2026, but in phases and without a fixed date. So if you renovate in 2026, you plan under the GEG as it stands today.

Do I have to install a heating system running on 65 % renewables from July 2026?

In new-build areas, yes: the 65 % rule has applied there since 2024. In existing buildings, it depends on your municipality's local heat plan. For cities with more than 100,000 residents, the deadline was pushed from July to 1 November 2026, and for smaller municipalities it is 30 June 2028. Up to those cut-off dates you may still install a new gas or oil heating system, but only after mandatory prior consultation.

Do I have to replace my old heating system?

Only if it is an oil or gas constant-temperature boiler more than 30 years old. Low-temperature and condensing boilers are exempt from the replacement obligation. If you were already living in your own single- or two-family home on 1 February 2002, you are exempt until the house changes owner. These rules are set out in section 72 of the GEG and continue to apply regardless of the planned GModG.

I bought or inherited an old house. Which deadlines apply?

As the new owner, you have two years from your entry in the land register to meet any outstanding retrofit obligations: insulate the top-floor ceiling, insulate accessible pipework in unheated rooms and decommission an old constant-temperature boiler. This two-year deadline kicks in when the previous owner was exempt under the 2002 owner-occupier exception. It does not apply to apartment buildings.

How much funding do I get for a new Wärmepumpe (heat pump)?

Through KfW 458 (as of July 2026, according to KfW) you get at least 30 % base funding, plus up to 20 % as a climate-speed bonus, 30 % as an income bonus for a taxable household income up to 40,000 €, and a 5 % efficiency bonus. All bonuses together are capped at 70 %. In a single-family home, 30,000 € in costs are eligible, so up to 21,000 € in grants. To see which rates actually add up for your situation, use the KfW-Förder-Finder.

What is the iSFP (individual renovation roadmap) and why does it pay off twice?

The individual renovation roadmap is drawn up by a certified energy-efficiency expert, and the BAFA funds it at 50 %, up to 650 € for a single-family home. It sets out the sensible order for your measures and unlocks the iSFP bonus: 5 percentage points more in grants and a funding cap that doubles from 30,000 € to 60,000 € per residential unit and year. The iSFP is valid for 15 years.

In what order should I renovate?

First the building envelope (roof, facade, basement ceiling, windows), then the heating system, and after that renewable generation such as solar PV. Here is why: an insulated envelope lowers the heating load. A smaller, cheaper Wärmepumpe (heat pump) then does the job, running at a lower flow temperature and a higher seasonal performance factor. If you flip the order and swap the heating first, you often end up paying for an oversized system.

Can I combine funding with the section 35c tax bonus?

Not for the same measure. Even partial funding of a single measure rules out section 35c for that exact measure completely. If you carry out several separate measures on the same house, you may choose a different route for each one. Section 35c gives you 20 % over three years (7 %, 7 %, 6 %), up to a maximum of 40,000 € per property, with no application needed since it runs through your tax return.

What does an energy-efficient renovation of a typical single-family home cost?

For an unrenovated 140 m² house from the 1970s, the cost is roughly 80,000 to 170,000 €, depending on your target level (Effizienzhaus 70 to 55). After funding, your own share works out at around 35,000 to 120,000 €. A full renovation to new-build standard can cost 210,000 to 392,000 €. These are ballpark figures that vary widely by region and condition, especially for labour-intensive measures. For an estimate tailored to your house, use the Sanierungskosten-Rechner.

Does insulation cause mould?

No. Proper full insulation raises the surface temperature of your interior walls and actually reduces the risk of mould. Problems come from the opposite: partial insulation, uninsulated thermal bridges, new airtight windows without an adjusted ventilation routine, or insulation applied to damp material. Cleanly planned and executed, insulation is not a mould risk.

Should I expect a freeze on applications?

As of July 2026, there is no freeze on applications. That said, the loan budget for a full renovation to Effizienzhaus level (KfW 261) was cut sharply for 2026, to around 2 billion €. It could run out over the course of the year. So the rule is: apply early and wait for your approval notice before you place the order.

I rent out the property. Can I pass the renovation on to the rent?

Yes, through the modernisation surcharge under section 559 of the German Civil Code (BGB): 8 % of the cost per year, capped at 3 €/m² within six years, or at 2 €/m² if the starting rent is below 7 €/m². You have to deduct any grants you received from the passable costs first. Landlords cannot use the section 35c tax bonus, which is reserved for owner-occupiers.