Berlin approves five-year rent freeze to combat rising housing costs

German capital’s housing senator says measure needed to ‘calm the overheated rental market’

Adam Forrest
Tuesday 18 June 2019 23:48
Comments
Berlin tenants protest against rising rents
Berlin tenants protest against rising rents

Berlin’s government has approved a plan for a five-year freeze on rents aimed at taming soaring housing costs in the German capital.

The legislation follows huge pressure from residents angry that rent hikes are making the city – where 85 per cent of people rent their homes – unaffordable.

The city’s housing senator Katrin Lompscher said the rent cap, planned to take formal effect in January next year, would be backdated to 18 June to prevent landlords rushing to raise rents before the proposal becomes law.

“With the new law we want to put a stop to the serious rent increase in recent years and calm the overheated rental market,” said Ms Lompscher.

Artists and students were drawn to cheap housing in Berlin after German unification in 1990, but rents in the fashionable city have more than doubled since 2008, according to a study by online housing portal immowelt.de.

Despite a huge influx of people from across Europe in recent years, campaigners have been keen to keep Berlin rents more affordable than in London, Paris or New York City.

A two-bedroom apartment in the trendy Prenzlauer Berg neighbourhood currently costs about 1,500 euros (£1,341) a month – far less than equivalent-sized flat in desirable London neighbourhoods such as Stoke Newington or Primrose Hill.

Activists worried about gentrification recently launched a campaign to get the state government to seize control of nearly 250,000 private apartments in the city rented out by corporate owners.

Protesters hold a banner during a 2018 demonstration against rising rents

Shares in some of the private property companies with large portfolios in Berlin fell after Tuesday’s announcement of the five-year rent control measure. Grand City Properties was trading some 0.8 per cent lower and Deutsche Wohnen fell by 1.25 per cent.

Speaking to investors in Frankfurt on Tuesday, Deutsche Wohnen chief Michael Zahn dismissed as “populism” the campaign by activists for state expropriation of his company’s properties.

Last week chancellor Angela Merkel met some of the tenants campaigning against rising rents in a country where home ownership is traditionally low.

Merkel spoke at a meeting in Cologne of the German Tenants Association. Its head, Franz-Georg Rips, warned that members were losing faith in the government’s ability to tackle rent rises.

Thorsten Schaefer-Guembel, acting co-leader of the centre-left Social Democrats, has said his party will discuss nationwide rent controls with Ms Merkel’s coalition Union bloc.

Additional reporting by agencies

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in