Rent subsidy plan – who will benefit?

A draft proposal of the Ministry of Investment and Development was recently sent for public consultation. It provides financial support for people renting homes from the primary market or from revitalisation areas. Who will the rent subsidy plan cover? What level of subsidy can we expect? What are the chances of success for the new government programme?

• The next step
• Basic criteria
• Income criteria
• Other important information

The next step

The rent subsidy plan emerged as a somewhat better thought-out continuation of the “Mieszkanie dla Młodych” (Flat for the Young) programme and an extension of “Rodzina 500 Plus” and “Mieszkanie Plus”. According to the reasoning put forward, it will provide financial relief for those Poles who rent flats rather than buy them. The authors of the proposal explain that the scheme is aimed mainly at people who cannot obtain a flat from the municipal housing stock (because their earnings are too high) and who do not have the creditworthiness to buy a flat of their own.

The programme is due to be launched at the beginning of 2019 and is meant to be a major help, especially for families.

Basic criteria

It is only natural that, to benefit from a government programme, one must meet specific conditions. In the case of the rent subsidy plan, they are as follows:

• The home comes from the primary market or a designated revitalisation area
• The beneficiary of the programme meets the income criteria – described in more detail later in the text
• The person receiving the subsidy does not hold ownership rights to a residential property
• The number of people in the household also matters

It is worth remembering that a disability certificate will also be taken into account when determining eligibility for the subsidy.

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Income criteria

According to the current provisions of the draft act, single-person households will be able to receive the subsidy provided that the average monthly income does not exceed 60% of the average salary. This currently stands at 2,563 PLN net, which means that a tenant will be able to earn a maximum of… 1537.8 PLN in the period under review.

The situation is much better for multi-person households – it is hard to deny that the scheme is aimed precisely at them. Each additional person raises the limit by 30 percentage points. A 2+2 family can therefore earn (in total) as much as 150% of the average salary, that is 3844.5 PLN.

Thanks to such strictly defined thresholds, the Ministry argues that the number of people entitled to the subsidy may reach as much as 40% of society!

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Other important information

Those interested in the new ministerial programme will be able to submit their applications directly to municipal offices. There the applications will be verified and, if all the criteria are met, the applicants will finally be placed on the list for subsidies. It is worth remembering that, instead of creditworthiness, rent-paying ability will be checked, based, for example, on stable employment.

Subsidies may reach several hundred PLN, depending on the size of the household. According to Deputy Minister Artur Soboń, an example family consisting of parents and two children will pay 500 PLN less where the base rent is 1,500 PLN.

Importantly, the rent subsidy can be received for a period of up to nine years with the proviso that the financial situation and rent-paying ability of the programme's beneficiaries will be reviewed every three years. The subsidy will also be gradually reduced every three years, in order to avoid a situation in which families become dependent on this form of assistance.