The goal of the move is to help people deal with the high cost of living.
A senior member of Germany’s ruling coalition said that Berlin is considering putting a nationwide rent freeze in place for three years; this would help keep housing costs in the EU’s biggest economy under control.
Tenants are having a hard time because rents are going up so fast, and Germans are still dealing with the effects of the energy crisis and high inflation that has been going on since last year.
Last week, Verena Hubertz, the deputy parliamentary group leader for the Social Democratic Party, told Bild am Sonntag, “We need a break for tenants. We need a rent freeze for the next three years.”
Under the plan, landlords could be made to give back “usurious” rents, which are more than 20% higher than the market rate in areas without enough homes.
The government also wants to tighten the rules that are already in place to limit rent increases; this is because decorated homes that are rented out temporarily only sometimes fall under the regulations.
The country’s property market is regulated by rules that limit rent increases to 20% over three years or 15% in places where there aren’t enough homes for people to live in. Berlin has already agreed to drop this limit to 11%, but the federal government says more is needed.
With the new rules, rents could only go up by 6% in places with high demand. Rents would stay the same everywhere else in the country.
In Germany, rents have gone up at high rates this year. In the past, the cost of living in the country has been stable enough that families could rent a house or flat their whole lives instead of buying their own.
According to the German Federal Statistical Office, a little less than 60% of Germany’s 41 million families are currently renting.
Germany also has to pay more for other things. In the year up to July, consumer prices rose by 6.2%, which was higher than the average of 5.3% in the Eurozone. Germany went into recession in the first three months of this year because of high inflation, worsened by a drop in oil supplies from Russia.