A report published by German market-leading portal ImmoScout24 in conjunction with economic publication Wirtschaftswoche claims that the German capital is seeing 25% fewer rental listings compared to a year ago. The reason cited by the publication for the drop in availability is a law that came into force in February which mandates that rents in all buildings constructed before 2014 are capped at their levels from June 2019, effectively putting an end to any price hikes on the part of landlords. It seems that landlords have been looking to offload their properties in buildings affected by the new law, as ImmoScout24 found that an extra 38% of properties in older buildings were coming onto the sales market.
The report also shows the glaring difference between the German capital and the country’s other main cities where there were on average 33% more rental listings on the portal in July 2020 than in July 2019.
The new Berlin law is highly controversial and is even being reviewed in the Federal Constitutional Court and the politician behind it has since resigned after a scandal involving incorrectly billed payments. Due to the uncertainty around the law, many landlords are currently advertising their properties on ImmoScout with a “two-rent model” where the price without the rent cap and the rent-cap compliant price are displayed on the listing.