Germany’s federal government and the states have agreed to allocate €1 billion annually for urban development, effective 2026. The new agreement, signed by all Länder, entered into force on 14 April 2026 and provides municipalities with funds to create attractive, sustainable living and working spaces. The financing covers three programmes—vibrant centres, social cohesion and growth/renewal—and is available to cities and communities. The budget will rise to €1.58 billion by the end of the legislative period, almost doubling the amount available for this election cycle. Minister Verena Hubertz said the support will help build lively neighbourhoods, increase green spaces and improve climate‑friendly infrastructure. The initiative is positioned as a key element of the government’s effort to strengthen social cohesion and democratic participation.
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