Opinions on the rent freeze could hardly be more contradictory. Depending on the political orientation or position on the real estate market, it is seen as a failure or as urgently needed to regulate the sharp rise in rents.
To prevent rents from rising further in areas with a tight housing market, the so-called rent freeze was introduced in 2015. This stipulates that when an apartment is re-let, the new rent may not be more than ten percent above the local comparative rent.
Federal Minister of Justice Marco Buschmann (FDP) has now launched a bill that extends the rent freeze until the end of 2028. Originally, the rent freeze was due to expire in 2025. The respective state governments will decide whether and where the rent freeze applies.
"It's good that a concrete draft bill for the extension of the rent freeze is finally on track. This was long overdue. We need the extension as soon as possible ...", says Helmut Dedy, Chief Executive of the Association of German Cities.
The association Haus & Grund Rheinland Westfalen rejects the extension. The Federal Constitutional Court has only tolerated this "serious encroachment on freedom of ownership and contract as a temporary emergency measure". The demand for housing has been greater than the supply for years. "Politicians have so far failed to reduce construction costs and heal the imbalance between supply and demand by building more new homes".
Dr. Christian Osthus, Managing Director of the real estate association IVD Bundesverband, states: "The rent freeze is unconstitutional despite the moderate tightening. The Federal Constitutional Court only approved it in 2019, four years after it came into force, because it is limited in terms of location and time".
The German Tenants' Association (DMB) welcomes the fact that the rent freeze has entered the departmental coordination phase and that the long overdue implementation is thus gathering pace. "The situation on the rental market is precarious - one in three tenant households is already overburdened with their housing costs."
Photo: © Petr Podlesak, Pixabay
