Top German court scraps Berlin's rent cap spurring protests

Photo: AP

A controversial cap to control soaring rents in the German capital has been scrapped in the courts, in a ruling welcomed by landlords but panned by tenants, thousands of whom took to the streets to protest, dpa reported.

The legislation came into force in February 2020 and theoretically froze the rents of around 1.5m flats in Berlin at June 2019 rates, for five years. Landlords who were charging over a limit prescribed by the city government had to reduce the rents, sometimes by hundreds of euros.

But those restrictions came to an end on Thursday when the Federal Constitutional Court ruled that the Berlin government had overstepped its powers in introducing the law.

The court decision means that rents that had been frozen or reduced in line with the law can now go back up to their previous level. Furthermore, many thousands of tenants are legally required to backpay their rent to cover the months where they were paying less thanks to the law.

Several thousand people turned out to demonstrate in Berlin on Thursday evening. The protesters called for a nationwide rent freeze, and criticized the decision by Germany's highest court. They demanded politicians clamp down on what they described as "rent madness."

Economy Minister Peter Altmaier and Interior Minister Horst Seehofer welcomed the court's ruling. "We all want there to be affordable housing. But the rent cap was not the way," Altmaier said.

The Berlin decision was being carefully watched in other parts of Germany. In Bavaria, a campaign to introduce a local rent cap was immediately shelved, with campaigners saying they would focus instead on making a change at national level.

The cap was unique to the German capital, where a left-wing coalition has been in power under Mayor Michael Mueller. He had described the law as a necessary "breather" for tenants struggling to deal with the soaring cost of renting property in the city. After the legal defeat, Mueller said that if states were not able to act on rents, then the federal government must quickly take the initiative.

The challenge in the Constitutional Court was originally brought by the centre-right CDU and CSU parties and the liberal FDP party, who argued that the city government had exceeded its powers.

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