Berlin rent cap: Capital is first German city to introduce controls on what landlords can charge

Landlords are now banned from charging new tenants more than 10 per cent above the local average

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Berlin has become the first city in Germany to introduce a cap on what landlords can charge new tenants.

Landlords in the capital are now prohibited from raising rent prices by more than 10 per cent higher than the average for that area, according to The Guardian. Residents in Berlin have experienced some of the most rapidly rising rents in the European Union, with figures showing a 9 per cent increase between 2013 and 2014.

The rent cap already applied to existing tenants, meaning the difference between what was charged for existing contacts and new contracts was high, according to Reiner Wild, the managing director of the Berlin Tenants’ Association. “The other problem is that we have 40,000 more inhabitants per year," said Wild.

“We don’t want a situation like in London or Paris,” he added. “The reality in Paris or London is that people with low income have to live in the further-out districts of the city.”

There has been growing calls for rent control legislation in London as the cost of living in the British capital spirals out of control. Landlords upped rent prices by eight per cent last year and tenants in the UK have few legal protections in comparison with other countries. A survey conducted earlier this year by YouGov found that only 8.6 per cent of people were against mandatory rent controls while 59 per cent supported them.

The number of crowded flats appearing in newspapers where beds and wardrobes are in the kitchen are a testament to the housing crisis facing renters in London.

One brutally honest estate agent’s description of an east London flat failed to deter prospective tenants despite being advertised as “not very nice” with an asking price of £997 per month.

Another estate agent was forced to defend the price of a flat in west London described as having a “good sized living area”, which was also where the bed was located.

Betsy Dillner, the director of Generation Rent, told The Independent more extensive rent controls would be needed to protect tenants in London.

“London’s rental market has far higher rents and fewer existing regulations than Berlin’s, so replicating this rent policy here would not work.

"Sitting tenants are not protected from rent rises, so it’s easier for the average rent to rise, making a cap for new tenancies pointless. We want to see a cap on all rents with a mechanism to boost supply – landlords would be permitted to charge more as long as they paid into a local fund to build social housing.”