IVD on the most important changes for owners and landlords
On 10 July 2026, the Bundestag passed the Building Modernisation Act (GModG). It replaces the Building Energy Act (GEG) of 2023 and brings numerous changes for owners and landlords. “Many owners are currently wondering which heating system they will be allowed to install in the future. The Building Modernisation Act simplifies individual regulations. However, landlords will also face new burdens,” says Henner Schmidt, energy expert at the German Real Estate Association IVD.
Existing heating systems may continue to be operated
One of the changes: The previous obligation to shut down constant-temperature boilers that are more than 30 years old will no longer apply. Existing heating systems may continue to be operated as long as they are technically functional. The complicated special regulations for gas floor heating systems will also be abolished. In the future, the same regulations will apply to them as to other gas heating systems.
New gas and oil heating systems possible again
The law once again opens up the possibility for owners to install new gas and oil heating systems. However, the condition is that they use gradually increasing shares of biofuels or hydrogen. The so-called “bio-staircase” will start with a share of ten percent from 2029, rise to 30 percent by 2035 and reach 60 percent from 2040. This obligation can also be fulfilled by hybrid heating systems, which use gas or oil to a lesser extent and a heat pump, solar thermal or solid biomass to a larger extent. Anyone who installs heat recovery systems is also exempt from the biostairs.
Different rules apply to landlords
This actually gives owners more freedom of choice again, but this is limited by the profitability analysis for landlords: According to the new regulations, landlords will bear half of the costs for blended biogas, gas network fees and CO₂ costs in the future.
“For rented residential buildings, these additional burdens for landlords usually make the installation of a new gas heating system uneconomical. In 2035, when the biogas share reaches 30 percent, the landlord’s share could be a quarter of the total heating costs. The profitability of gas hybrid heating systems is also declining compared to today,” says Schmidt.
“In addition, parts of the gas networks will be gradually shut down in the next few years, thus eliminating the option of gas heating in some places. This aspect must also be taken into account when making a long-term investment decision,” says Schmidt.
The most important changes at a glance
Existing heating systems may continue to be operated. New gas and oil heating systems are permitted again. For new gas and oil heating systems, a gradual admixture of biofuels or hydrogen (“biostairs”) will apply in the future. Hybrid heating systems are exempt from this obligation. For landlords, there are new burdens due to the contribution to the costs of biofuels, gas network fees and CO₂ levies.Gas and oil heating systems are a new option for owner-occupied detached and semi-detached houses, but they are usually uneconomical for rented buildings.
IVD recommends individual advice
Even though changes to existing laws are constantly being adopted, the choice of the right heating technology remains a long-term decision. In addition to the legal requirements, owners should therefore take into account the development of energy and CO2 costs, security of supply and the individual circumstances of their property. The IVD therefore recommends that planned heating modernisations be examined at an early stage together with qualified energy consultants and specialist companies.
