Federal Government Plans €2 Billion Wohngeld Cuts from 2027
Germany's federal cabinet approved a draft bill in early July 2026 to reduce housing benefit (Wohngeld) spending by €2 billion annually, cutting eligibility and payments from January 2027. Up to a third of the 1.2 million current recipients could lose benefits entirely.
On July 6, 2026, Germany's federal cabinet approved a draft bill to cut housing benefit (Wohngeld) spending substantially. Housing Minister Verena Hubertz submitted legislation aiming to reduce annual expenditure from approximately €5 billion to €3 billion, with both federal and state governments finding €1 billion in savings each.
The impact on recipients will be severe: an estimated one-third of the 1.2 million households currently receiving Wohngeld are expected to lose eligibility entirely when the cuts take effect on January 1, 2027. Remaining recipients will experience reduced payments, and eligibility thresholds will tighten.
Timeline and Implementation
- Cabinet approval: July 6, 2026
- Draft now under inter-ministerial consultation
- Will proceed to Bundestag for debate and potential amendment
- Scheduled to take effect: January 1, 2027
- Existing benefit decisions remain valid until expiry, then new rules apply on renewal (typically 12 months)
This follows a major expansion in 2023 (Wohngeld-Plus Act), which tripled the eligible beneficiary pool from around 600,000 to approximately 2 million households. The cuts represent a reversal of that reform amid fiscal pressures.
Wohngeld provides rent subsidies (Mietzuschuss) to working people, pensioners, and students with low or moderate incomes. The average payout in 2026 is approximately €370–€400 per month, with eligibility varying by household size and local rent levels (Mietstufe).
If you currently receive Wohngeld, verify your eligibility under the new rules immediately. You should request an advance payment (Vorschuss) if authorities delay beyond eight weeks. Those who lose eligibility may qualify for citizen's benefit (Bürgergeld) instead — your job center will compare the two. Reapply before your current award expires (typically two months in advance) to avoid payment gaps.
Sources
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