You have inherited a house – but instead of joy, you are overwhelmed by concerns about unpredictable renovation costs? Many heirs are familiar with this feeling, suddenly confronted with the legal obligations of the Buildings Energy Act (GEG). This guide will show you how not only to manage the financial burden but also turn it into a value-enhancing investment.
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The topic briefly and concisely
Heirs are required by the GEG to carry out energy-efficient renovations and are given a deadline of two years to do so, otherwise they face fines of up to €50,000.
The cost of a complete renovation often ranges between €70,000 and €150,000, with the roof, facade, windows, and heating being the biggest items.
State subsidies from KfW and BAFA can reduce costs by up to 70% (in the case of heating replacement).
Inheriting a property often comes with an unexpected challenge: the legal obligation to undertake renovations. The Buildings Energy Act (GEG) mandates that new owners must bring older buildings up to modern energy standards within two years, or face fines of up to €50,000. Many heirs fear escalating costs. However, with a clear strategy, the right prioritisation of measures, and full utilisation of government grants, the energy renovation costs for an inherited house can be precisely managed. This article provides you with the necessary key figures and a roadmap to efficiently handle the renovation and sustainably increase the value of your property.
Understanding the Legal Obligation to Remediate in the Event of Inheritance
When you inherit a property, you assume the legal responsibilities of the previous owner. The Building Energy Act (GEG) stipulates specific retrofitting obligations for existing buildings when ownership changes. As the heir, you have exactly two years to meet these requirements. One of the core obligations is the insulation of the top storey ceiling or roof if they are uninsulated; here, a thermal transmittance (U-value) of no more than 0.24 W/(m²K) must be achieved. Additionally, oil and gas boilers over 30 years old that operate at a constant temperature must be replaced. Failure to comply with these deadlines can lead to severe fines of up to €50,000. There are few exceptions, such as if you, as the heir, have been living in the house yourself since before 1 February 2002. A thorough assessment of the individual renovation needs is therefore the first indispensable step. The legal requirements form the basis for the subsequent cost calculation.
Calculate the four largest cost blocks based on data
The total cost of an energy-efficient renovation is composed of several major components. A data-driven estimate helps you establish a realistic budget. The four key measures account for the majority of expenses.
Roof renovation and insulation: Here, you should expect costs between 150 € and 280 € per square metre, depending on the insulation material and the condition of the roof structure.
Facade insulation: External insulation with a thermal insulation composite system (ETICS) costs between 100 € and 250 € per square metre.
Window replacement: Installing modern triple-glazed windows costs between 800 € and 1,400 € per window.
Heating renewal: Switching to a heat pump is the largest single investment and often costs between 25,000 € and 40,000 €, including installation.
A typical detached house with 140 m² of living space can quickly incur renovation costs of 70,000 € to 150,000 €. A detailed renovation cost calculator can provide an initial guide. These figures highlight why utilising subsidies is not a bonus, but a central part of financial planning.
Utilise government subsidies to reduce the investment
You don't have to bear the high investment costs alone. The federal and state governments offer substantial financial support through the Federal Funding for Efficient Buildings (BEG). The responsibilities are clearly divided: The Federal Office for Economic Affairs and Export Control (BAFA) supports individual measures on the building envelope, while the Kreditanstalt für Wiederaufbau (KfW) is responsible for the heating replacement. For insulation, window replacement, or ventilation systems, you receive a 15% subsidy from BAFA on eligible costs. When it comes to heating replacement through KfW, the support is even higher: A base subsidy of 30% is the foundation. This can increase through various bonuses to up to 70% of the investment costs of a maximum of €30,000, which corresponds to a subsidy of up to €21,000. Additionally, KfW offers a supplementary loan of up to €120,000 per residential unit to secure the remaining financing. A professional funding check is essential to ensure no funds are lost. The right strategy when applying is crucial for success.
Enhance efficiency with the individual renovation schedule (iSFP)
How can you ensure that the measures are optimally coordinated and that you receive the maximum funding? The answer is the individual renovation roadmap (iSFP). This document, prepared by a certified energy consultant, analyses the current state of your property and outlines a sensible, step-by-step renovation path. Creating an iSFP costs around €1,300 for a single-family home, but it's subsidised by BAFA with up to 50%. However, the real financial advantage lies elsewhere: If you implement a measure recommended in the iSFP (e.g. façade insulation), the BAFA grant increases by a bonus of 5 percentage points – turning 15% into 20%. Therefore, the iSFP often pays for itself with the first measure. It serves not only as a technical guide but also as a strategic tool for maximising your return. Unsure where to start? Our ImmoGPT chat can provide you with an initial, data-driven assessment of the condition of your inherited property. An iSFP is the logical next step when you're asking yourself: What to do next?
Increase in value instead of a cost trap: Securing long-term returns
Die energetische Sanierung ist weit mehr als eine gesetzliche Pflicht – sie ist eine der sichersten Investitionen in die Zukunft Ihrer Immobilie. A comprehensive renovation can reduce the energy costs for heating and hot water by up to 80%. At the same time, a good energy state significantly increases the market value of your property. Studies show that properties with good energy efficiency (class A or B) can achieve price premiums of up to 20% compared to unrestored properties. This increase in value often far exceeds the pure investment costs, especially after deductions for subsidies. You turn a potential cost trap into a profitable and future-proof asset. Whether you use the property yourself, rent it out, or plan to sell – the investment pays off. A thorough valuation before and after renovation quantifies this added value precisely. This allows you to make your decision based on a solid, data-driven foundation.
Conclusion: Act strategically and maximize property value
The energy-efficient renovation of an inherited house is a financial and organisational challenge, but not an insurmountable obstacle. The key to success lies in a structured approach: Understand your legal obligations, realistically calculate the cost blocks, and consistently take advantage of government funding programmes. An individual Renovation Roadmap (iSFP) serves as your compass, not only guiding you but also securing additional financial benefits. This way, you minimise the burden while maximising the value and sustainability of your property. Act now, plan wisely, and turn your inheritance into a success story.
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Additional useful links
Statista provides statistics on the costs of energy-efficient renovations of rental apartments in Germany.
The Federal Statistical Office (Destatis) releases a press release on construction and housing.
The DIW offers a weekly report on energy-efficient building renovations, declining investments, and the unattainability of climate targets without a change in trend.
IW Consult provides an expert report on renovation potentials in residential properties.
The Federal Ministry of Finance provides information on inheritance and gift tax.
The KfW offers information on the Federal Funding for Efficient Buildings (Residential Buildings) as a loan (261/262).
The Consumer Center Bavaria releases a press statement on renovation obligations for heirs of old houses.
The dena provides information about the study 'Fit for 2045' Part 2.
FAQ
What measures are required for an inherited house?
According to the Building Energy Act (GEG), you generally need to retrofit three things within two years: 1. Insulation of the top floor ceiling or the roof to a U-value of 0.24 W/(m²K). 2. Replacement of boilers that are over 30 years old and operate at a constant temperature. 3. Insulation of uninsulated heating and hot water pipes in unheated rooms.
Are there any exceptions to the obligation for heirs to renovate?
Yes, the most important exception concerns owners of single-family and two-family homes who were already living in the property before the cut-off date of 1 February 2002. Exceptions may also apply if the renovation costs are economically disproportionate or if there are monument protection requirements. However, this must be examined on a case-by-case basis.
How can I finance the renovation costs?
The financing is usually done through a combination of equity, government grants (BAFA/KfW), and loans. In addition to grants, KfW also offers a low-interest supplementary loan of up to 120,000 euros, which is specifically intended for the remaining financing of energy-efficient renovations.
What is the iSFP bonus?
The iSFP bonus is an additional incentive. If you carry out a renovation measure on the building envelope (e.g., insulation) that was planned in an individually created renovation roadmap (iSFP), the BAFA subsidy increases by 5 percentage points, from 15% to 20%.
Does an energy renovation really increase the value of the house?
Yes, significantly. A refurbished house not only has considerably lower energy costs, making it more attractive to buyers and tenants, but it also achieves a higher selling price. Properties with a good energy efficiency class (A/B) are worth up to 20% more on the market than non-refurbished properties in classes G or H.
Where do I apply for the funding?
You must submit the applications to the relevant institutions. For boiler replacements, the KfW Development Bank is your contact. For all other individual measures such as insulation, windows, or the energy consultation itself, the Federal Office for Economic Affairs and Export Control (BAFA) is responsible. Important: The application must always be submitted before commissioning the craftsmen.
