German court nullifies Berlin rent cap for breaching constitution

Berlin, Apr 15 (EFE).- A top German court on Thursday overturned Berlin’s rent freeze after deciding it went against the constitution.

State authorities in the German capital introduced the measure last year to cap the price of rent for the next five years. It affected around 90% of properties in the city.

Judges at the Federal Constitutional Court said that federal-level rent control was already in place and ruled that the state-level rent freeze was therefore null and void.

The Berlin rent cap locked the price per square meter of apartment space at a maximum of 9.80 euros ($11.70). It affected 1.5 million homes in Berlin, where 85% of people live on a rental basis.

It was designed to keep housing in the capital affordable as prices soared in the last decade, fuelled by an influx of people to the city, low interest rates and limits to new construction, meaning supply could not keep up with demand.

When the rent cap came into effect, all new contracts had to be in line with the law and landlords who contravened the rules could have faced fines of up to 500,000 euros. EFE


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