Germany extends Rent Control to limit rising rents until 2029

The Bundestag has approved the extension of the rent control law for four years. In a vote on Thursday, the coalition factions of the CDU/CSU and SPD, together with the Greens, approved the extension until the end of 2029. The AfD voted against the extension, and the Left Party abstained. Further proposals for greater tenant protection by the Left and the Greens failed to gain a majority.

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The rent control law gives federal states the opportunity to cap rent increases for new apartments in areas with a tight housing market. The costs may then not exceed the local comparative rent by more than ten percent.

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The SPD said the extension was only the first step. SPD Bundestag member Hakan Demir said he did not want to hide the fact that his party would have wanted more. "We still have a long way to go." Among the necessary further improvements to tenant protection, he cited the regulations on index-linked rents, short-term rentals, and furnished accommodation already announced by Federal Justice Minister Stefanie Hubig (SPD).

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AfD MP Stefan Möller accused the coalition of being uncompromising. "They see the landlord as the enemy," Möller said. The AfD opposes the rent control and argues that more housing is needed.

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Left Party MP Caren Lay said the only thing the law had achieved was a simple "business as usual." Despite the rent control, rents in Germany have risen sharply. "The rent control doesn't slow things down; it's a misnomer." Lay called for better protection against eviction. Green Party MP Hanna Steinmüller called for changes to tenancy law. The German rental market is very heterogeneous, with rents varying significantly from region to region. This, too, must be taken into account.

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The rent control measure would have expired on December 31. The extension was justified by the fact that the rental housing market in Germany remains severely strained in many municipalities.

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Regarding the extension, Hubig stated, "Tenants need protection against unchecked rent increases." Further changes to tenancy law are firmly agreed upon in the coalition agreement – ​​"and we are keeping our word to tenants. I will quickly implement further packages to improve tenant protection, for example, on index-linked rents, furnished apartments, and the expansion of grace period payment regulations."

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The property owners' association Haus & Grund, however, criticized the rent control as a "political fetish." "The governing coalition is clinging to an instrument that does more harm than good, but is intended to continue to serve as a tranquilizer," explained President Kai Warnecke. Evaluations of the rent control have produced sobering results. The goal of ensuring access to affordable housing for all segments of the population in strained housing markets is not being achieved.

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