Court Blocks Plans for New House Despite Citizen's Income

The recent ruling by the Lower Social Court of Niedersachsen-Bremen has brought clarity to the conditions under which individuals receiving Bürgergeld (Citizen's Income) can own property. The court determined that while beneficiaries can maintain ownership of their homes, they cannot utilize social benefits to fund the construction of new residences.

Typically, individuals in Germany who rely on Bürgergeld are permitted to retain their homes, provided they are occupied as their primary residence. In these cases, job centers are responsible for covering housing and heating costs, akin to traditional rental arrangements. Additional expenses such as property taxes and urgent repair costs may also be eligible for support, including replacements for essential systems like heating.

However, the court's recent decision underscores that the size and appropriateness of the property are critical factors. For example, households of up to four individuals are deemed to have a reasonable living space of up to 140 square meters, with an additional 20 square meters allotted for each extra household member.

The case that prompted this ruling involved a family in the Emsland region, who endeavored to upgrade their living situation while receiving Bürgergeld. They sold their previous home, which they claimed was too distant from the city center, for EUR514,000 and undertook the construction of a new, larger residence.

The job center intervened, asserting that the family's actions rendered them ineligible for continued support, as their new property exceeded the limits of acceptable living space for Bürgergeld recipients. The family contested this decision, maintaining that their home constituted protected assets that should not impact their eligibility for social assistance.

Despite their arguments, the court upheld the job center's decision, indicating that the family's new property--spanning 254 square meters and accommodating seven individuals--could not be classified as protected wealth. The ruling emphasized the family's ability to leverage the property for financial support, with a market value of EUR590,000 and a mortgage of EUR150,000, leaving them with a net asset of EUR440,000.

Additionally, the court rejected the family's claim regarding a twelve-month grace period before assessing property suitability under Bürgergeld regulations. This provision is intended to prevent beneficiaries from depleting their savings, such as retirement funds, during temporary financial hardships. In this instance, the court highlighted that the family's situation did not constitute an unexpected crisis but rather a strategic decision to optimize their residential and financial circumstances.

This ruling sets a significant precedent, clarifying the limitations on property ownership for Bürgergeld recipients and reinforcing the importance of maintaining financial need to qualify for social support.