Germany: Berlin rents shot up by nearly 10 percent in two years

Rents in Berlin increased drastically over the past two years, according to an official city report seen by local media.

Over the past two years, rents in Berlin rose by 9.6 percent, according to a biennial city development report seen by Berliner Zeitung and Tagesspiegel. And the increase for particularly well-furnished apartments increased by more than 10 percent. The Mietspiegel report (rent index) is set to be officially presented next week.

In comparison to the last Mietspiegel report for 2013 to 2015, rents increased by about half as much over that time period – 5.4 percent.

On average, rental costs before utilities are factored in went from €5.84 per square-metre in 2015 to about €6.40 per square-metre in 2017. Flats in Altbau-style buildings from the 19th century so-called “founders’ period” saw particularly higher rental prices, likely because of their beloved parquet wood flooring and ornate, stuccoed ceilings, according to Berliner Zeitung.

The high demand for apartments in the growing city amid its relatively low supply of housing puts renters at a disadvantage without much choice, allowing landlords more leeway to hike up prices.

The Mietspiegel aims to better inform tenants, providing details on whether prices are fair for a building’s age, size, and location.

SEE ALSO: What you need to know about renting in Germany

It’s also important to know there are rent control laws in Berlin that generally cap new rental agreements at no more than 10 percent above the average price in a given area. For example, if a 100-square-metre apartment lies in an area where the typical price is €600, then the maximum price you should see on a new contract would be €660.

For continuing tenants, landlords may only increase prices when they have not yet exceeded the average area price. They also cannot raise prices by more than 15 percent within three years.

But a big exception to this rule is rental costs for extensively modernized apartments, or newly built flats.

Another problem is that studies have found many landlords not adhering to rent control regulations. A study by the Institute for Social City Development (IFSS) last year revealed that 80 percent of online housing listings analyzed listed rents above what was legally permissible.

And because it’s so hard to find an apartment in Berlin, flat-hunters are often willing to give in to higher prices. This in turn then drives up average, comparable prices for landlords even further.

“The rent controls unfortunately do not work,” Reiner Wild, head of the Berlin Tenants’ Association, told local broadcaster rbb.

“We demand that at the least, a fine could be imposed for when a landlord violates the rent controls.”

Published by: The Local
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