A Month In, Berlin Rent Control Already Lowering Prices

April 19, 2015 – 08:26 am

Creative Commons image via m.a.r.c.

While its only been in effect for a little more than a month, Berlin's new rent control law is starting to lower prices, according to Germany's leading real estate site. ImmobilienScout24 crunched the numbers, which show that the average price of new rental contracts in the capital has fallen 3.1 percent, compared to static or rising figures in other big German cities, as well as Berlin's typical jump of 0.3 percent per month. As reported in CityLab, the mietpreisbremse, or rental price brake, is doing its job. Seems to good to be true? According to Wibke Werner of the Berlin Tenants' Association, it's not a glitch in the data due to last-minute rent hikes by landlords.

Translation: the rent brake is working. Graphic via Frankfurter Allgemeine

Is this proactive stance taken by Berlin's government—which forbids new rental contracts from jumping more than 10% above a median price for each city district—a model for others? The city government's moves to forbid luxury condos in areas of fast-rising rental costs and restrict vacation rentals, as well as fund an extensive program to build additional rental apartments, are in many ways logical continuations of existing laws that are much more pro-renter than other major cities. While Berlin might be ahead of the curve, and beginning to get ahead of the cost curve, for other cities, it may take a series of laws and adjustments to replicate this victory against rising rents.


Source: curbed.com


 

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