The German government has decided to extend the Rental Price Brake, known as „Mietpreisbremse,“ for new rentals and lease renewals until the year 2029.
Initially introduced in 2015 and set to expire in 2025, the purpose of the rental price brake was to ease the housing market and slow down excessive rent increases.
According to this regulation, the rent for a new lease cannot exceed 10% above the local comparable rent.
The property owners’ association, Haus & Grund Deutschland, has already announced plans to legally challange the extension of the rent control measure. Nevertheless, a study conducted by the German Institute for Economic Research confirms that in areas where the rental price brake has been in effect since 2015, rent increases have been less pronounced.
However, rental prices in major cities such as Berlin, Hamburg or Cologne still rose by an average of 6.7% in the first half of 2023.
