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US News Karlsruhe rejects urgent application against rent cover

18:55  29 october  2020
18:55  29 october  2020 Source:   finanzen.net

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Shortly before the second stage of the controversial Berlin rent cover came into force, the Federal Constitutional Court refused a temporary stop.

Wohnhäuser in der Nähe des Alexanderplatzes in Berlin. © Christoph Soeder / dpa residential buildings near Alexanderplatz in Berlin.

The Karlsruhe judges rejected the urgent application for an interim order from a civil law company. This rents 24 apartments in Berlin.

It was not apparent that the company would suffer serious disadvantages as a result of a rent reduction that is soon possible by tenants, the court announced (Az. 1 BvR 972/20). The economic consequences of a reduction in rental income are not of particular weight if they are not existential. A threat to the existence of the company was neither presented nor apparent.

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In Berlin, rents for 1.5 million apartments have been frozen since February 23, as of June 2019. From 2022 onwards, they may increase by a maximum of 1.3 percent annually. If an apartment is rented out again, the landlord must adhere to new upper limits set by the state and the last rent demanded.


Video: Berlin rent cap: Karlsruhe rejects the stop (dpa)

According to the court, the second stage will take effect nine months after the law came into force on November 22nd: then excessive rents are prohibited. Tenants whose existing rent is more than 20 percent above the upper limit can then reduce this. Landlords had filed an urgent application against this regulation in Karlsruhe. You had claimed a considerable amount of extra effort in the implementation.

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Berlin's Senator for Urban Development Sebastian Scheel (left) stated that the regulation on rent reduction will come into effect as planned. "Today's court decision encourages us in our decision to stick to the current housing policy course taken by this Senate and to continue to take decisive action against the rapid price development on the Berlin rental market." Experts assume that rent reductions will be possible for around 340,000 apartments.

With the nationwide unique rent cap, the red-red-green Senate wants to curb the recent sharp rise in rents in the capital. The politically and legally highly controversial regulation is limited to five years. This does not include new apartments that were ready for occupancy from January 1, 2014.

A fundamental decision by the Federal Constitutional Court on the lid is expected in the first half of 2021. Members of the Bundestag from the CDU and FDP, but also landlords, had called Karlsruhe. They consider the regulation to be unconstitutional.

The Berlin Senate is looking forward to the decision of the highest court with confidence, said Scheel. The Berlin tenants' association concluded from the current decision of the constitutional judge “that excessive and unconstitutional interference with property rights is no longer suspected”. In contrast, the Real Estate Association Germany (IVD) emphasized that the court had "by no means" declared the rent cap to be constitutional.

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