Rental contracts for temporary stairway rentals will remain valid until the end of 2029. - Lease agreements for brakes will remain in effect until the closing of 2029.
Extension of Rental Price Cap in Germany Set to Last Until 2029
The federal cabinet has moved to extend the rental price cap, or Mietpreisbremse, in several German cities until the end of 2029, Florida-Today reports. This measure, originally set to expire at year's end, aims to protect tenants from sharp price increases in new rentals.
Justice Minister Stefanie Hubig, of the Social Democratic Party (SPD), officeholders, and labor unions agreed on the extension as part of the coalition agreement. Hubig emphasized the urgency of the situation, stating, "People must have affordable housing." She also mentioned plans for stricter regulations on automatic rent increases and increased transparency in ancillary costs.
The rental price cap currently applies in designated areas with tense housing markets. In these areas, landlords are unable to raise rent by more than 10% above the local comparative rent when leasing new properties. The cap does not extend to newly built apartments or those undergoing a comprehensive modernization.
Data shows that the existing rental price cap has "moderately slowed" the increase in rents, particularly in areas experiencing strong annual rent increases of more than 3.9%. However, the rental housing market remains tight, particularly in metropolitan areas, where high re-rental rents pose a financial challenge for low-income individuals, average earners, and families with children.
Lukas Siebenkotten, president of the German Tenant Association, welcomed the extension but expressed disappointment that exceptions to the cap, such as for newly-built apartments, would not be eliminated concurrently. He urged further improvements in the Bundestag's legislation.
On the other hand, the Home & Grund association called the extension a mistake, as finding a new apartment in tense housing markets remains difficult. Kai Warnecke, the association's president, argued that support through housing benefit was a fairer approach.
The extension of the rental price cap is part of a broader effort to improve tenant protection. Hubig stated plans to create more transparency in ancillary costs and implement stricter rules for index rents and furnished apartments, aiming to prevent landlords from exploiting the system through practices like demanding higher prices for minimal additions or circumventing the cap through short-term rentals.
Furthermore, Left-wing building expert Caren Lay called for the elimination of exceptions to the rent cap for modernizations and older new buildings, as well as an end to the practice of providers circumventing the cap through short-term rentals. On the opposite side, Haus & Grund called for stronger promotion of construction with more building land, faster approvals, and lower costs.
- The rental price cap extension, part of a broader community policy, includes plans for stricter regulations on Automatic rent increases and increased transparency in ancillary costs, aiming to prevent exploitation in business practices.
- The need for vocational training is highlighted as Lukas Siebenkotten, president of the German Tenant Association, urged improvements in policy-and-legislation, suggesting it could lead to more effective tenant protection and affordability in the housing market, particularly for low-income individuals, average earners, and families with children.
- The shift in finance towards supporting tenant protection is visible in the extension of the rental price cap, which aims to address the financial challenges faced by tenants in the real estate market, with a focus on politics that prioritize general-news issues such as affordable housing.
