Berlin adopts five-year freeze to rein in soaring rents

[President Johnson]

Berlin Adopts Five-Year Freeze to Rein In Soaring Rents

Berlin’s plan to rein in the city’s rental market was approved by lawmakers, capping revenue for property owners and potentially driving investors away from the German capital. Shares in major landlords slumped.


Berlin’s legislature backed measures including a five-year rent freeze Thursday, more than six months after they were proposed by the left-leaning administration. The changes will likely come into force by the end of February, though opposition parties have signaled their intention to challenge them in court.

The initiative put forward by the Left party’s Katrin Lompscher, head of urban development and housing, is intended to ease the burden on tenants after a property boom caused rents to double over the past decade. The political intervention has spooked investors as a separate campaign attempts to force Berlin’s government to expropriate properties from large landlords including Deutsche Wohnen SE.

[...]

Full article (Bloomberg)


I have mixed feelings on this, but it's obvious we need more government intervention to solve Germany's gigantic housing problems. However, the only substantial solution is more construction of middle class housing units, more public housing and a reform of regulations. The bureaucracy makes construction way too costly and too slow.

Let's see how this plays out in the coming years. Its constitutionality is still in question though as to whether a state government can issue such rulings. Usually housing and property is a federal issue.

[Meclazine for Israel]

The other option i thought was limiting the number of properties any individual or company can own.

A person with zero properties in the market can get trapped in renting.

Whereas an investor with 162 properties can buy two new ones per year forcing prices higher and keeping the renters out of owning property.

Australia has similar issues.

I think capping the rent is not the solution.

[CumbrianLefty]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

[True Federalist (진정한 연방 주의자)]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

They only work well when there has been a sudden unexpected increase in demand for or a decrease in supply of a good or service for which supply can be increased but not quickly.

[Starry Eyed Jagaloon]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

[Intell]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

They can work temporary with an increase in supply of housing. The focus should be building more social housing more than rent control though. 

[Starry Eyed Jagaloon]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

They can work temporary with an increase in supply of housing. The focus should be building more social housing more than rent control though. 

That is true, but rent control makes increasing the supply in housing very, very difficult without ENORMOUS social housing construction (which has its own associated problems and expenses), and generally a housing shortage persists and housing conditions degrade anyway. It's better to just go full YIMBY.

[Intell]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

They can work temporary with an increase in supply of housing. The focus should be building more social housing more than rent control though. 

That is true, but rent control makes increasing the supply in housing very, very difficult without ENORMOUS social housing construction (which has its own associated problems and expenses), and generally a housing shortage persists and housing conditions degrade anyway. It's better to just go full YIMBY.

It has expenses, it doesn't have problems, social housing has worked throughout Europe and Australia post-war to this day.

[Silent Hunter]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

They can work temporary with an increase in supply of housing. The focus should be building more social housing more than rent control though. 

That is true, but rent control makes increasing the supply in housing very, very difficult without ENORMOUS social housing construction (which has its own associated problems and expenses), and generally a housing shortage persists and housing conditions degrade anyway. It's better to just go full YIMBY.

Indeed, become a private renter isn't cheap - there's a lot of work to do to, for example, turn a three storey house into three flats.

[MaxQue]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

It works, if you admit the role of the government is to provide housing rather than providing wealth to landowners.

[True Federalist (진정한 연방 주의자)]

"Rent controls don't work" is a key prop of neoliberalism and needs to die.

Rent controls don't work.

It works, if you admit the role of the government is to provide housing rather than providing wealth to landowners.

In what weird world do you live where rent control is necessary for government-provided housing to exist?

[Omega21]

I suggest you guys research the Vienna model.

https://www.huffpost.com/entry/vienna-affordable-housing-paradise_n_5b4e0b12e4b0b15aba88c7b0

One of the areas where Germany has only gone downhill in the last decades, such a shame.