There is a shortage of housing in Germany. The high rents in large cities have therefore become a major burden well into the middle class. The rent freeze, which has now been extended, is intended to prevent tenants from being overburdened. Unfortunately, it is also slowing down housing construction, which could fundamentally solve the problem.
The rent freeze was first introduced in 2015 in regions with a tight housing market. It stipulates that the rent for a new rental may only be a maximum of ten percent above the local comparative rent. On June 26, 2025, the German Bundestag has now decided to extend the rent freeze until 2029.
The reason given: The federal government needs time to create better framework conditions for housing construction - for example through the "construction turbo". After all, rising rents can only be averted by building more affordable apartments. "All studies show that excessive regulation leads to less supply because landlords withdraw from the market," argues the CDU/CSU parliamentary group.
The opinion of experts and the public on the rent freeze ranges from "The rent freeze is a bad joke" to statements such as "The luck of the rent freeze".
The German Economic Institute (IW) writes: "Up to 40,000 additional apartments per year could fall under the price brake. (...) This will make housing construction more difficult. The housing crisis is coming to a head. (...) Rent controls such as the rent freeze will lead to less supply, a declining willingness to invest and decreasing housing quality in the medium term."
The German Property Federation ZIA writes: "The continuing decline in the number of building permits and the slump in building completions in 2024 make it clear that Germany is in urgent need of reliable and investment-friendly framework conditions. This is the only way to create urgently needed living space and ensure long-term relief on the housing markets."
Photo: © Rollstein, Pixabay
