Politician advocates for additional measures to combat escalating rental costs
Berlin Senator Calls for Expansion of Rent Brake to New Buildings
Berlin's Senator for Urban Development, Christian Gaebler (SPD), is urging the federal government to take further action to curb rising rents, particularly in areas with a tense housing market. Gaebler, a member of the SPD party, believes that additional measures are needed, including the expansion of the rent brake to new buildings.
The rent brake, a policy measure implemented by the federal government to address rising rents in certain areas, was recently extended for four years. However, it does not currently apply to new buildings completed after October 1, 2014. The Berlin Senate is currently in discussions with the federal government about the possibility of expanding the rent brake to include new buildings.
Gaebler, who is also the Senator for Urban Development in Berlin, has expressed concerns that a broad expansion of the rent brake could prevent investments, such as the renovation of their own buildings, by state-owned and community-oriented housing companies. He has ruled out a complete rent stop, where rents could no longer increase in Berlin.
Currently, German federal states have limited options to expand the rent brake for new buildings. They can implement the extended federal rent brake in their "tight markets," officially designating more areas where the rent brake applies. Another option is adjusting local Mietspiegel (rent reference databases), which serve as benchmarks for permissible rents under the rent brake, influencing the baseline for rent calculations. Enforcing compliance more rigorously to curb circumvention by landlords is also an option, though it is hampered by administrative costs and legal loopholes.
However, there is significant criticism from the real estate industry that extending or expanding the rent brake could discourage investment in new construction, worsening the housing shortage and limiting supply expansion, which is necessary to curb rents structurally. The federal government has so far preferred this approach for short-term rent relief rather than structural supply-side measures.
In Berlin, a corresponding law regarding a possible rent cap failed before the Federal Constitutional Court a few years ago. The state SPD chairman Raed Saleh has recently called on the federal government to make it possible to limit rents to a certain level in Berlin.
In conclusion, while federal states can expand the rent brake for new buildings only by expanding the geographical scope of "tight markets" as allowed under federal law and applying local Mietspiegel adjustments, the broader extension and framework are controlled federally, limiting states' autonomous options. The prevailing discourse suggests a tension between rent control expansion and incentives for new housing supply.
- Gaebler has proposed that the expansion of the rent brake policy-and-legislation to new buildings should be discussed at the federal level, considering the current tense politics surrounding housing in certain areas.
- The general-news of Berlin's Senator Gaebler advocating for the inclusion of new buildings in the rent brake agreement has sparked debates about how this move could impact investment in the real estate sector and the supply of housing.
