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Fast Money & Foreign Objects
Berlin Rent Cap Puts the Brakes On Escalating Prices
Monday, June 8, 2015, by Patrick Sisson
Kreuzberg, a neighborhood in Berlin, has seen rent skyrocket over the past decade. Photo by TijsB/Creative Commons
Like many capitals of cool across the globe, Berlin has been a bit of a victim of its own success, drawing so many new arrivals to hip neighborhoods that rents have skyrocketed. Last week, however, to the envy of many city dwellers, Berlin passed legislation introducing a rent cap, according to The Guardian, limiting the amount landlords can raise rent when changing tenants. Going forward, landlords can't raise the rent by more than 10 percent of the local average for all new rent contracts, whether it's a new or existing tenant. That's the kind of proactive support of affordability that will have many renters says "Ich bin ein Berliner."
Housing in Berlin hasn't hit the stratospheric heights of, say, London, but due to an influx of foreign renters, as well as a spike in property investments resulting from a perception that German real estate is a safe bet, it's certainly been on pace. From 2013 to 2014, rent rose by more than 9%. According to Reiner Wild, managing director of the Berlin Tenants' Association, with 40,000 new inhabitants per year, Berlin is seeing incredible turnover, a perfect opportunity to increase prices. The story of skyrocketing prices certainly is a familiar one for cities such as New York; while NYC has strict controls on rent stabilized apartments, which may see a break this year, other units can move as far as the market will bear.
∙ Berlin becomes first German city to make rent cap a reality [The Guardian]
∙ Mapping New York Neighborhoods Hit Hardest by High Rents [Curbed NY]
∙ This Custom Modern Houseboat May Be Berlin's Hippest Rental [Curbed]
http://curbed.com/archives/2015/06/08/berlin-rent-cap-puts-the-brakes-on-escalating-prices.php
thoughts?
Monday, June 8, 2015, by Patrick Sisson
Like many capitals of cool across the globe, Berlin has been a bit of a victim of its own success, drawing so many new arrivals to hip neighborhoods that rents have skyrocketed. Last week, however, to the envy of many city dwellers, Berlin passed legislation introducing a rent cap, according to The Guardian, limiting the amount landlords can raise rent when changing tenants. Going forward, landlords can't raise the rent by more than 10 percent of the local average for all new rent contracts, whether it's a new or existing tenant. That's the kind of proactive support of affordability that will have many renters says "Ich bin ein Berliner."
Housing in Berlin hasn't hit the stratospheric heights of, say, London, but due to an influx of foreign renters, as well as a spike in property investments resulting from a perception that German real estate is a safe bet, it's certainly been on pace. From 2013 to 2014, rent rose by more than 9%. According to Reiner Wild, managing director of the Berlin Tenants' Association, with 40,000 new inhabitants per year, Berlin is seeing incredible turnover, a perfect opportunity to increase prices. The story of skyrocketing prices certainly is a familiar one for cities such as New York; while NYC has strict controls on rent stabilized apartments, which may see a break this year, other units can move as far as the market will bear.
∙ Berlin becomes first German city to make rent cap a reality [The Guardian]
∙ Mapping New York Neighborhoods Hit Hardest by High Rents [Curbed NY]
∙ This Custom Modern Houseboat May Be Berlin's Hippest Rental [Curbed]
http://curbed.com/archives/2015/06/08/berlin-rent-cap-puts-the-brakes-on-escalating-prices.php
thoughts?
