Many tenants don’t stand a chance these days. In the cities in particular, there are hardly any offers on the competitive housing market without index rental contracts that are linked to the consumer price index. With high inflation rates of up to ten percent, these contracts quickly become a trap. But the need is great and so many people sign it.
In major cities, every third new lease now has an indexation. This is the result of a survey by the German Tenants’ Association (DMB), which collected data from the six largest cities. In Berlin, the proportion of index rents is now as high as 70 percent. “With high inflation and rising energy prices, index rents have become an unacceptable cost trap and must also be more limited in the portfolio,” said DMB President Lukas Siebenkotten recently.
70
percent of new leases in Berlin are linked to the consumer price index.
In the case of the SPD and the Greens, Siebenkotten is running into open doors. The two parties have long wanted to reform tenancy law and are pushing for the implementation of the coalition agreement, where the traffic light agreed on lowering the cap limits and extending the rental price brake until 2029. The former would mean that landlords would only be allowed to increase rents by eleven instead of the previous 15 percent within three years. But the FDP and the lead Federal Ministry of Justice (BMJ) under Marco Buschmann (FDP) have so far put the brakes on and remain inactive even with the index rents that were not negotiated in the coalition agreement.
What has been causing trouble behind the scenes for months is now being publicly released shortly before the Berlin elections. “We would very much wish that Minister of Justice Buschmann would no longer be the stumbling block at traffic lights,” says Dirk Wiese, deputy leader of the SPD parliamentary group in the Bundestag, with unusual sharpness.
The Social Democrats are annoyed that eleven legislative projects are now being blocked in the BMJ, including a law from the house of building minister Klara Geywitz (SPD) that is intended to enable the municipalities to apply a legally secure right of first refusal. “This project hasn’t progressed for almost a year because the Federal Ministry of Justice hasn’t ticked it,” criticizes Wiese.
He also sees Buschmann as having an obligation when it comes to index rents. “The current inflation rate is leading to significant rent increases. We must not stand idly by here,” Wiese told the Tagesspiegel.
We would very much wish that Minister of Justice Buschmann would no longer be the stumbling block at traffic lights.
Dirk Wiese, deputy parliamentary group member of the SPD, takes a sharp stance on the liberal coalition partner.
Hanna Steinmüller, housing and social expert for the Greens in the Bundestag, also criticizes the actions of the liberals. “The FDP and Minister of Justice Buschmann are blocking any reform on the backs of the tenants,” says the Berlin MP. In her consultation, it would often be about high rents, she reports. Capping limits, rent control, right of first refusal and index rent should finally be on the agenda of the Minister of Justice.
The Ministry of Justice does not consider the problem to be quite as urgent. When asked, a spokesman pointed out that tenants with index rents had benefited from the low inflation rates in recent years. There are also no reliable figures for an increase in index rents, but I have now initiated a query with the associations. Buschmann himself had previously criticized in the Tagesspiegel interview that too little was being built in cities like Berlin. “The Berlin Senate is more of a brake than an accelerator.”
The Bushman sets the tone for the FDP, because the liberals would rather deregulate construction than intervene in the housing market. The FDP calls for a “construction booster for Germany” in a draft of a position paper that the parliamentary group wants to adopt on Tuesday and which is available to the Tagesspiegel.
In it, the liberals are calling for the concept of building land to be expanded in order to make more space available. In addition, the examination of construction plans is to be accelerated, more buildings are to be raised and a digital building application is to be introduced.
“Always tightening the tenancy law does not solve the actual problem,” says Daniel Föst, construction and housing policy spokesman for the FDP parliamentary group, who drafted the paper. He is convinced that it must be built faster and cheaper. “Greens should finally stop demonizing the new building,” he tells the Tagesspiegel and, for his part, rejects state regulation of index and graduated rents. “Politics based on the current situation and ideology do not solve the rent problem.”
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Source: Tagesspiegel
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