Rent Control Regulation

Rent Brake (Mietpreisbremse) and Berlin Rent Cap (Mietendeckel) explained

Depending on the city and the time of first occupancy, apartment rents can be subject to regulation in Germany. The following shall give you an idea, whether your apartment falls under this regulation.

The Berlin Rent Cap came into force on February 23, 2020. However, following constitutional challenges the constitutional court voided the law, so that it is of no relevance anymore.

For the Rent Brake of the German Civil Code, the constitutionality was approved by the German constitutional court on July 18, 2019. So this law is here to stay.

Does my Apartment fall under Rent Regulation?

The Rent Brake is federal law and applies in areas of tense housing markets that the state legislators may specify. The state of Berlin has done so for whole Berlin, just as other state legislators have done for several cities in Germany, see here.

The Berlin Rent Cap applies to Berlin apartments only, as it is Berlin state law.

Rent Brake – NOT, if built or extensively modernized after October 1, 2014:
For the Rent Brake, apartments are excluded that were first used after construction or an extensive modernization after October 1, 2014. We talk of an extensive modernization, if the apartment condition after modernization is roughly comparable to a new apartment AND if modernization costs were approximately 1/3 of the costs of a new apartment, minimum.

Moreover, apartments are exempted from the Rent Brake Regulation regardless of the time of first use, if

  • the lease is for temporary use only, or
  • the leased residential space is part of an apartment, which is used and furnished by the landlord. For the Berlin Rent Cap such exceptions shall not apply.

Since January 1, 2019, landlords may only invoke the cut-off-date of the Rent Brake, if the landlord informs the tenant prior to the conclusion of the rental agreement that the apartment was first used after October 1, 2014, after construction or extensive modernization.

What are the Maximum Rents under the Rent Regulation?

Maximum Rents under the Rent Brake (“Mietpreisbremse”, §§ 556d-g BGB)
Under the Rent Brake, the rents for re-letting and initial rental must not be

  • 10 % higher than the comparative average rent (in Berlin calculated according to the Berlin Rent Index OR
  • higher than the previous rent if the previous rent was valid. Based on this, the maximum rent can exceed the comparative average rent. However, note, since January 1, 2019, the landlord may only invoke the higher rent if he or she has informed the tenant about the previous rent before conclusion of the lease.

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