Berlin Rent Freeze Explained

Berlin Rent Freeze Explained

Berlin just passed a new law that freezes rents for five years. The Berlin rent freeze gives tenants and law-makers some breathing room as the city comes to terms with its extraordinary growth and desperate need for more housing.

Everyone wants to live in Berlin. At least that’s how it can seem while apartment hunting. Demand for apartments in Berlin is so high that rent prices doubled over the last decade. 

Finally, Berlin tenants can breath a sigh of relief. In an effort to control rapidly rising rents, the Berlin House of Representatives passed a new rent control law, which went into effect in February.

The rent freeze applies to apartments in buildings constructed before 2014 — about 1.5 million, in other words, three quarters of Berlin’s apartments. 

What does the Berlin rent freeze (Mietendeckel) mean for me? 

If you rent an apartment in Berlin, which was built before 2014, the rent stated on your lease on June 18, 2019 — the date the law retroactively takes effect — is the rent you will pay for the next five years. 

However, you should expect a small increase each year. Beginning in 2022, landlords can increase rents by 1.3 percent to align with inflation levels.

According to the new law, if your landlord increased your rent after June 18, 2019, you could be eligible for a rent deduction. This also applies to renters who signed a new lease after June 18, 2019.

You will pay the same rent as the last tenant.

Many cities around the world have rent control laws. Unique to the Berlin law is that landlords are not allowed to raise rents even after a tenant moves out. So, according to the new law, if you sign a new lease for an apartment within the five-year rent freeze period, you should be paying the same amount the former tenant paid.

Berlin Rent Freeze Explained

You might be eligible for a rent deduction.

Another unique aspect of the Berlin rent control law is that some tenants may be eligible for a rent decrease if their current rent is deemed “excessive.” 

The new law introduces a rent cap of €9.80 per square meter (cold rent/excluding housing fees) for apartments built before 2014. Various aspects come into play when calculating the exact rate, including what year the building was constructed, what amenities it has, and if it’s in a desirable neighborhood.

If your current rent is 20 percent more than €9.80 per square meter (cold), you should be able to apply to the Senate Department for Urban Development for a rent reduction. The office should begin accepting applications in November, 2020, nine months after the law was passed. If your application is accepted, and all goes as planned, you will begin paying your new, lower rent one month later.

No more Berlin rent-hikes after renovations.

In the past, landlords could increase rents after making certain renovations, or “modernizations.” This is no longer permitted. Although there are a couple exceptions. If a landlord carries out renovations to either make an apartment accessible, or to combat climate change — for example make the apartment more energy efficient — they could then increase rents by €1 per square meter. 

What if I live in a new building?

If you live in an apartment in a building constructed after January 1, 2014, your rent is not affected by the new rent freeze law. The law makes an exception for new Berlin buildings in an effort to encourage more construction of new residences. And with 40,000 people moving to Berlin every year, that’s something the city desperately needs.

Is it possible the law could change?

The new Berlin rent control law is controversial, with many real estate agencies saying the restrictions are “unconstitutional.” According to several sources, lawsuits have been filed against it. Only time will tell if the new law will continue as is, and how it will effect life in the German capital.

** Please note, the information in this article is our opinion based on our research from the sources listed below. As a relocation agency,  Archer Relocation does not provide legal advice, but we want to provide information that may be helpful to our clients living in Berlin.

Senatsverwaltung für Stadtentwicklung und Wohnen — Informationen zum Gesetz zur Mietenbegrenzung im Wohnungswesen in Berlin (“Mietendeckel”www.stadtentwicklung.berlin.de/wohnen/wohnraum/mietendeckel/

Senatsverwaltung für Stadtentwicklung und Wohnen — Was bedeutet der Mietendeckel für Sie? www.mietendeckel.berlin.de

Deutsche Welle “Berlin rent cap takes effect amid urban exodus” — www.dw.com/en/berlin-rent-cap-takes-effect-amid-urban-exodus/a-52486849

Deutsche Welle “Berlin’s new rent freeze: How it compares globally” www.dw.com/en/berlins-new-rent-freeze-how-it-compares-globally/a-50937652

 

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Archer Relocation has been providing relocation services to families, individuals and companies in Berlin since early 2015.  Managing Director, Emily Archer, founded the company desiring to use her first-hand experience as an expat to make the relocation process as smooth as possible for others moving to Berlin.  Read other useful information about moving to and living in Berlin, such as ‘How to Find a Berlin Apartment’, on our Berlin Blog.  

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