Berlin rents: how much intervention is needed?

The Berlin Senate's draft law for introducing a rent cap is kicking up a storm. The plan is to limit base rent prices to no more than 7.97 euros per square meter. Anyone who pays more can apply for a reduction. This will smother the free market, some critics say. Others argue that the free market doesn't work anyway.

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Die Presse (AT) /

A policy worthy of Maduro

The measures put forward by Berlin's left-wing senator for construction are an outdated Marxist throwback, sneers Die Presse.

“The party only needs ask its idol Maduro in Caracas what happens when the state sets a cap that is lower than production costs. Perhaps a little research on the 'Friedenszins', the Austrian rent cap that led to such a terrible decline in building quality, would be in order. ... It really shouldn't concern us if the Germans decide to throttle the house construction and renovation sector in their capital city. But when dusty old Marxist ideas that have failed time and again start becoming socially acceptable in a neighbouring country with which we are so economically intertwined, we should definitely start worrying. ”

Der Freitag (DE) /

Breathing space for tenants at last

The weekly Der Freitag welcomes the general concept behind the draft law:

“The state is at last intervening in a market that - in spite of all the housing sector's claims - is no longer working. ... One common argument is that neither a rent cap nor dispossession [of owners] would create a single new apartment. Build, build, build is the only solution. ... But after the experiences of this past year there is every reason to doubt that the private housing market would really have acted where it was needed: in the segment of affordable apartments and social housing. Yet this is exactly what is needed, which is why rent control - in whatever form it comes in the end - is the only way to achieve the breathing space that everyone is talking about.”