Is the Mietpreisbremse having any visible effect?

With most of Germany having only introduced the Mietpreisbremse, or rental cap, over the summer monthts, it's still a little too early to generalise about the effect the measure is having in Germany's most in-demand residential rental markets.

However, in Berlin, the internet portal ImmoScout24 (which just this week floated on the stock market – see elsewhere in this issue) says the cap is already havening a dampening effect on offered rents.

Rents stabilised at around €8.50 per sqm per month in Berlin in September, after falling two months in a row following the introduction of the rental cap, ImmoScout24 found in a report.

In Munich and Hamburg, average offering rents fell in August, by 1.53% to €14.15 and by 0.69% to €10.05, respectively. “We are not seeing any pronounced increase in offering rents in German conurbations in August,” said Jan Hebecker, head of data & markets. This could of course have to do with the general holiday season and may not be representative.

Other sources see no visible effect yet from the introduction of the law. According to Roman Heidrich, who heads up residential valuation advisory at JLL in Berlin, it's hard to determine any 'braking' effect from the law. "Demand is so strong and supply is tight. By many estimates Berlin needs 20,000 new apartments a year – and with the refugees coming, we will need more than that. This year, around 10,000 will be built, compared to 7,300 last year –it is still not enough."

So far it seems as if tenants are still just prepared to pay to get the apartment they want, even if the landlord charges €10.00 per sqm, which is 50% more than the average Mietspiegel or 'allowed' rent in the city. If there is much risk of litigation against the landlord, it hasn't been tested in the courts yet.