BERLIN, Feb. 14 (Xinhua) -- The German Bundestag on Friday passed the extension of the national rent brake, a law regulating maximum rents in Germany introduced in 2015.
In view of the housing shortage in many places in Germany and rising rents, the law allows Germany's federal states to restrict rents in densely populated areas by issuing a legal ordinance.
"It is a very important decision that the rent brake will be continued for another five years and can have a dampening effect on overheated rental markets," said Christine Lambrecht, Federal Minister of Justice and Consumer Protection.
Under the price brake, landlords are generally only allowed to charge 10 percent more than comparable local rents.
Despite the rent brake, a recent study by the German Property Federation (ZIA) showed that asking rents in Germany increased by 3.5 percent year-on-year to 8.13 euros (8.88 U.S. dollars) per square meter in 2019.
Although the increase has slowed down slightly compared to the previous year, prices would have been driven by the "high level of immigration" into cities and the "still low level of new housing construction," according to ZIA.
The Bundestag on Friday even made the rent brake more stringent, which would allow tenants to reclaim excess paid rent retroactively. "In this way, the potential of the rent brake would be exploited better," said the Federal Ministry of Justice and Consumer Protection (BMJV).
"We are sending a clear signal against black sheep among landlords who do not comply with the requirements of the rent brake," said Justice Minister Lambrecht.
