Cabinet decides on tighter rent controls

Affordable housing

Cabinet decides on tighter rent controls

Updated on December 11, 2024Reading time: 2 min.

The federal states themselves determine whether the rent cap applies in a certain area. It is not yet clear whether the temporarily introduced federal law that allows them to do this will be extended beyond the end of 2025. (Source: Marijan Murat/dpa/dpa-bilder)

According to the federal government’s wishes, the rent brake is to be extended until the end of 2029. However, it is not expected that their plan will find a majority in the Bundestag.

According to government sources, the Federal Cabinet has decided to extend the rent cap until the end of 2029. This is intended to prevent this instrument for tenant protection from no longer being available after December 31, 2025. So far, however, it does not look as if the bill passed on Wednesday will find a majority in the Bundestag.

The FDP says it does not want to take part. The Union would only like to address the question of how a new version of the rent cap still makes sense for a transitional period after the new election planned for February 23rd.

Where the rent cap introduced in 2015 applies, the rent when re-letting existing apartments may only be increased to the level of the local reference rent plus ten percent. The law authorizes state governments to designate areas with tight housing markets in which rent control applies. However, new buildings from October 1, 2014 are exempt from rent control, as is the first rental of an apartment after comprehensive modernization. The draft that the cabinet has now approved provides for a change here. In the future, the exception will only apply to apartments that are used and rented for the first time after October 1, 2019.

“The high rents in cities are a big problem for tenants,” says the legal policy spokesman for the Union parliamentary group, Günter Krings (CDU). In the event of participation in government after the election, the Union would therefore like to do “everything possible to achieve an expansion of the housing supply, but also to quickly examine the form in which a new version of the rent cap makes sense for a transitional period”. Since the current rent cap does not expire until the end of 2025, a newly elected Bundestag still has enough time to decide on it.

The developments in rents are “dramatic,” says Bernhard Daldrup (SPD). He therefore appeals to the Union not to leave tenants in the country out in the cold.