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Pekka Sagner / Michael Voigtländer IW-Trends No. 3 20. August 2021 How the Berlin Rent Cap Affected Private Landlords

The effects of the Berlin rent cap on the city’s housing market were wide-reaching, with the supply of rental accommodation falling by more than half while the cap was in force.

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How the Berlin Rent Cap Affected Private Landlords
Pekka Sagner / Michael Voigtländer IW-Trends No. 3 20. August 2021

How the Berlin Rent Cap Affected Private Landlords

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The effects of the Berlin rent cap on the city’s housing market were wide-reaching, with the supply of rental accommodation falling by more than half while the cap was in force.

However, to date little was known about the consequences of the measure for the capital’s private landlords. This study presents the results of a survey conducted in the early summer of 2021 among private landlords in Berlin regarding the effects of the rent cap on their letting activities. The survey was conducted in two ways: as part of an online panel, and in the form of a poll carried out in cooperation with Haus & Grund Berlin, an association of local property owners. The rent cap has now been declared void by the Federal Constitutional Court, but while it was in force the average rent per square metre of floor space in apartments let by private landlords fell by 6 per cent. This decline in rental income led to loan defaults for 4 per cent of the letters surveyed, and another 15 per cent experienced severe financial constraints. One-fifth of respondents reported a drop in their net wealth due to losses from rentals, and nearly 60 per cent indicated that the regulation had had a negative impact on their willingness to make large investments in their housing stock. In addition, the survey shows that while the rent cap was in force landlords increasingly used private contacts instead of online advertisements to find new tenants.

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Download PDF
How the Berlin Rent Cap Affected Private Landlords
Pekka Sagner / Michael Voigtländer IW-Trends No. 3 20. August 2021

How the Berlin Rent Cap Affected Private Landlords

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Pekka Sagner / Maximilian Stockhausen / Michael Voigtländer IW-Analyse No. 136 21. July 2020

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