Germany extends Rent Control Law 'Mietpreisbremse' until 2029

Germany’s rent control law, Mietpreisbremse, is a crucial regulation aimed at limiting rent increases in tight housing markets. With the federal government extending the rent cap until 2029, it’s essential for tenants, landlords, and investors to understand how this policy works, its exceptions, recent updates, and the ongoing debate in Germany’s real estate sector.

On Wednesday, the cabinet approved the draft bill presented by Justice Minister Stefanie Hubig (SPD) to extend the regulation by four years.

Currently, 13 of the 16 federal states have passed rent control regulations. There is no rent control in Schleswig-Holstein , Saxony-Anhalt , and Saarland.

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What is Mietpreisbremse? Understanding Germany’s Rent Control Law

The Mietpreisbremse, or rent control, was introduced in 2015 to cap rent increases on new leases in cities with high housing demand. This law allows federal states to restrict rents so that the net cold rent (basic rent excluding utilities) cannot exceed the local comparative rent (Mietspiegel) by more than 10%.

This regulation is designed to protect tenants from sudden and excessive rent hikes in competitive urban housing markets like Berlin, Munich, Hamburg, and Frankfurt. Tenants have the legal right to request a rent reduction if landlords charge above the permitted limit.

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How Mietpreisbremse helps tenants in Germany?

• Limits rental price increases in designated “tight housing markets”
• Keeps rent prices aligned with the local Mietspiegel, based on real market data
• Provides legal protection for tenants against unfair rental demands
• Supports affordable housing access in major German cities experiencing rapid rent growth

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Rent Control Extension: What’s new in 2025?

On May 28, 2025, the German Federal Cabinet extended Mietpreisbremse until December 31, 2029. This decision ensures continued rent protection for tenants over the next four years. However, the extension does not expand the rent control to newer buildings. The current cut-off date remains October 1, 2014, meaning that apartments built after this date are exempt from rent caps.

Justice Minister Stefanie Hubig (SPD) emphasized the urgency of extending rent control to prevent rising rents but indicated potential future discussions on including newer buildings.

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When does Mietpreisbremse not apply?

Important Exceptions

• Newly constructed apartments built after October 1, 2014 are exempt from rent caps
• The rent cap is only valid in officially designated “tight housing markets”, which federal states define by law
• Fully modernized apartments may be excluded if renovations significantly increase the property's value
• Certain commercial and furnished apartments may fall outside the rent control scope
• High-end or luxury apartments might not be subject to the Mietpreisbremse limits
• Apartments that are rented for only a few weeks or months
• Apartments that already had a too high rent prior to the current rental

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How to check the rent index (Mietspiegel) in your City?

The local comparative rent index (Mietspiegel) is vital for understanding whether a rent is within legal limits.

• Most German cities publish official Mietspiegel reports, accessible through local housing offices or municipal websites
• If a city lacks an official rent index, tenant and landlord associations typically compile and publish the data
• Tenants and landlords can request this information to verify compliance with Mietpreisbremse regulations
• The Mietspiegel reflects average rent levels based on apartment size, location, and condition

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Additional Tenant protection measures coming soon

Along with the Mietpreisbremse extension, the German government plans to introduce:

• Increased transparency around utility and ancillary costs
• Stricter rules on index-linked rental contracts to prevent unchecked rent increases
• Enhanced tenant protection for furnished apartments, ensuring landlords can’t unfairly raise rents by simply adding minimal furnishings

Justice Minister Hubig highlighted these upcoming changes as part of a broader push to safeguard tenants

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Real Estate Industry Criticism: Opposition to Mietpreisbremse Extension

The rent control extension has met significant pushback from Germany’s real estate sector. Dirk Salewski, President of the German Real Estate Association (BFW), criticized the policy, calling it a “confession of failure in housing policy.”

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Key concerns from the real estate industry include:

• Reduced incentives for landlords to invest in property upgrades, especially energy-efficient renovations
• Increased operational challenges and costs for property owners
• Potential exacerbation of rental housing shortages due to decreased market supply
• Calls for government focus on building new homes and deregulation rather than extending rent controls

This divide highlights the ongoing debate over how to best balance tenant protections with healthy housing market dynamics.

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What tenants and landlords should know in 2025?

Germany’s Mietpreisbremse continues to play a vital role in controlling rent prices and protecting tenants in competitive housing markets. With its extension until 2029, renters can expect ongoing safeguards against sharp rent hikes, provided the rental property and location meet the legal criteria.

Landlords and tenants should regularly check the local Mietspiegel and stay informed on upcoming tenant protection laws, including rules around utility costs and furnished apartments.

The discussion around rent control’s impact on housing supply and real estate investment remains heated, suggesting that Germany’s housing policy landscape will continue evolving in the coming years.