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Berlin rent cap overturned by Germany's top court

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Re: Berlin rent cap overturned by Germany's top court

#151

Post by throwaway85858 »

Here are some examples of ways berlin could have increased the amount of affordable housing:

1. Build more housing on land that is already owned by Berlin State

2. Increase the amount of housing support available to low income families

3. Prevent the migration of social housing units to the private market by extending existing contracts.

4. Close loopholes in the Mietpreisbremse that allowed landlords to dramatically raise the rent after renovations.

5. Block NIMBY movements from preventing the construction of housing projects

6. Fund the court system so cases can be resolved in less than a decade.

7. Increase the minimum number of social housing units in new developments to 50%

...

Re: Berlin rent cap overturned by Germany's top court

#152

Post by mpweiher »

mschuster91 wrote: post #29
mpweiher wrote: post #22

Earlier quoted context omitted.

> ... just build more housing instead. Exactly. And the Mietendeckel caused new construction to essentially stop completely. Way to go!

This is utterly wrong. https://taz.de/Mehr-Baugenehmigungen-in-Berlin/!5706294/

Nope. Your article was for the first half of 2020. For the whole year of 2020, the numbers were down again, fourth year running.

"16.03.2021: Heute hat das Amt für Statistik Berlin-Brandenburg die Baugenehmigungszahlen für das Jahr 2020 veröffentlicht. Die Zahl der Baugenehmigungen sank in Berlin das vierte Jahr in Folge."

https://www.immobilien-aktuell-magazin.de/topics/auswirkunge...

https://www.rbb24.de/politik/beitrag/2020/11/berlin-mietende...

And the effects already started in 2019, when the law was planned:

https://www.zeit.de/wirtschaft/2019-11/berlin-mietendeckel-g...

Re: Berlin rent cap overturned by Germany's top court

#153

Post by corty »

sabjut wrote: post #80
that_guy_iain wrote: post #47

Earlier quoted context omitted.

They're building housing all the time. There are 3-4 housing blocks being build near me. One office building being built. Everyone keeps acting like they can just build new housing over night. To be fair, construction work in Berlin is super slow.

Well in recent months the Tesla Giga Berlin factory has shown just how fast construction can take place if the people in power actually want it to happen. Building new housing units in the city slows the increase in value of existing real estate, which is why property owners are not rushing to allow the construction of new structures. Lobbyism is a powerful force in real estate.

The Gigafactory near Berlin is still on a temporary permit, meaning that they might have to tear it down again (at least in large parts) if the bureaucracy finds a nit to pick. There is still the possibility of more problems due to environmental protection regulations for the surrounding forest and the water supply.

All in all, while some politicians may have suggested that the Gigafactory is an example of a fast project they made possible, they no longer do so. Because actually it is a perfect example of everything being regulated to death, dog-slow bureaucracy and crazy risks you have to take as a business if you want things done fast. Where "fast" is still slow compared to the rest of the world.

No housing construction will ever go to the lengths Tesla did in terms of risk for a fast construction. Housing investment is notoriously risk-averse in any case.

Re: Berlin rent cap overturned by Germany's top court

#154

Post by kdtsh »

osclarto wrote: post #52

why does society consistently insist on funneling it's wealth to an unproductive class of elites? i want answers

The people who drive that wealth redistribution are the unproductive class of elites and have an interest in and the means to doing so.

Re: Berlin rent cap overturned by Germany's top court

#155

Post by phaer »

jurip wrote: post #107
Asmod4n wrote: post #65

Earlier quoted context omitted.

They are building a massive amount of houses, but they are too expensive for the average Berlin citizen.

I don't know the details of the Berlin situation, but as long as someone lives in those new apartments (who would have lived in Berlin anyway), it helps with the housing shortage and prices. Someone moves to the new, most expensive apartment in the city, someone else moves to their now vacant slightly less expensive apartment, etc. At some point in the chain that means there's cheaper housing available. This is a con…

That's true, but your premises are wrong for most of the luxury real estate market in European cities (and likely elsewhere). Most buyers are investors in one way or another and for them it's good enough if they believe that prices will continue to rise.

Re: Berlin rent cap overturned by Germany's top court

#156

Post by lqet »

killtimeatwork wrote: post #148
lqet wrote: post #105

Earlier quoted context omitted.

> Why not make it a multistory building with apartments on top of the supermarket and skip the parking space or put it underground? That's exactly what they are doing at a few places in my city (also with a massive housing problem). We recently found a new apartment here, the process was as follows: (1) We found the apartment online. It was online for exactly 6 hours, listed by an estate agent. (2) Inside the listing…

I'm always baffled by stories like this. If there's indeed so much interest in an apartment, why not increase the price to the point where 90% of contenders lose interest? The owner must have been in a huge hurry, or doesn't care about money?

> why not increase the price to the point where 90% of contenders lose interest

Because that's illegal, even without the rent cap in Berlin.

Re: Berlin rent cap overturned by Germany's top court

#157

Post by f6v »

jpxw wrote: post #61

Rent control doesn’t work, and never will. It is utterly ignorant of economic reality. Economists on almost all sides have admitted this at this point. The only people left clinging on to the idea are politicians who do it to pander to people for votes.

Rent control in Berlin is just trying to fix the problem in a most ridiculous way. The city is obviously attractive for both germans, and thousands of expats from Italy, Spain, Poland, Russia etc. How much housing is being built in Berlin? I don't know. But I do know that there're no new underground stations being built, save for that tiny new line in the downtown. No new stations means the city isn't expanding at all, while more and more people come to live there.

Re: Berlin rent cap overturned by Germany's top court

#158

Post by Tenoke »

timdaub wrote: post #116

I've been protected by this rule. I live in the north of Berlin. It saved me roughly 100€ a month. I found it fair for the appartment I rent. I can't say much about other cases. Since I have to pay back the cummulative savings to my landlord in case the law is overturned(which happened today), I saved 100€ extra each month. It's likely that I'll now have to increase my rent payment by 100€ and pay back roughly 1000€…

100e is pretty good. For me it was 500e less, and it made it even less possible for me to move to a smaller place which I've wanted to do since breaking up with my ex.

>It's OK for me. However, I know others that will likely lose their flat now.

They won't just lose their flat. If they can't backpay the rent (thousands in some cases) their Schufa will be ruined which will make it even harder if at all possible to get a new place.

Re: Berlin rent cap overturned by Germany's top court

#159

Post by crumbshot »

gambiting wrote: post #19
akie wrote: post #6

Well that's very disappointing.

It's not, rent caps are a great idea in principle but in reality it just massively constrains the supply which means that yeah, if you find a place to rent you will pay a "reasonable" rate, but there's 200 people willing to rent any place so when landlords aren't allowed to compete on price they compete on everything else. It leads to insanities like landlords requiring 6+ months of rent upfront, very long contracts,…

It all depends on how it's implemented. The usual method of controlling rent is to cap only a subset of properties in an area - for example, leaving new builds or new tenancies exempt. Which tends to create a two-tier system that benefits one set of tenants at the expense of the other, while discouraging reallocation for downsizing and suchlike. And as you allude to, without further restrictions on tenancy contract terms, the private landlords will attempt to extract their pound of flesh in other ways.

On the other hand, if rent controls are used as part of a wider strategy to gradually convert private rental stock over to social housing - that is, as a stick to encourage private landlords to sell up to the public sector - along with other measures including more state investment in building such housing, large fines for private landlords leaving their rental properties unoccupied, and so on, then this can be a long-term positive on the overall housing situation.

The end goal should be to remove this wholly unnecessary parasitic landlord class from the housing provision entirely, rather than tinkering around the edges of the problem, as this Berlin measure was doing.

Re: Berlin rent cap overturned by Germany's top court

#160

Post by EdwinLarkin »

gjulianm wrote: post #141
Asdrubalini wrote: post #118

Earlier quoted context omitted.

https://en.wikipedia.org/wiki/Supply_and_demand

https://en.wikipedia.org/wiki/Perfect_competition#Idealizing... People can't live without housing so demand is not elastic. Plus the housing market is special regarding spatial location. Applying regular market rules as if the housing market behaved the same as, say, the screwdrivers market, does not make sense at all.

In 99% cases it's the government/zoning rules that prevent increasing the supply of housing not private investors not wanting to build enough.
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