Germany's new plans to tackle spiralling rents

"Anyone who has tried to find an apartment to rent long-term in Germany's big cities knows that it isn't easy even with an above-average income and impeccable credentials. Browse through online property portals and you will likely find hundreds of apartments on offer in the most sought-after districts of cities like Berlin, Munich and Hamburg. But look more closely and the majority of those will be short-term, furnished rentals charging well above the standard rates landlords can ask for open-ended leases on unfurnished apartments."

"That's because an increasing number of landlords are using short-term leases and furnishings however basic to justify higher rents and circumvent rent control laws. Furnished apartments cost on average twice as much as regular apartments in the German capital, according to a study by Investitionsbank Berlin (IBB). A fully-furnished, 20-square-meter (215-square-feet) apartment in the newly built Haven's Living apartment complex in the Berlin district of Charlottenburg is currently advertised for 1,349 ($1,600) per month over 67 per square meter."

"Landlords must disclose how much has been added to the rent for furnishings. The surcharge for furnishings should be "appropriate" to the purchase price and current condition. There will be a flat rate of 5% of the net rent (excluding utilities) for fully furnished properties. Short-term rental leases will only be exempt from rent control if they are rented for a maximum of six months or less."

Long-term rental availability in Germany's major cities is constrained, with many listings actually short-term, furnished units commanding higher rents and avoiding rent controls. Landlords increasingly use basic furnishings and short-term leases to justify surcharges and circumvent tenant protections. A study by Investitionsbank Berlin finds furnished apartments cost on average twice as much as regular units, with example listings charging over €1,349 for a 20-square-meter unit. Justice Minister Stephanie Hubig's draft proposals require landlords to disclose furnishing surcharges, cap those surcharges as appropriate and set a flat 5% furnishing rate, while limiting short-term lease exemptions to six months and requiring tenant justification.

Read at www.dw.com