Berlin Rent Cap Toppled

27.04.2021

The Federal Court of Justice, Germany’s highest court decided that by introducing the rent freeze the local government in Berlin had overstepped its power and the law was overturned. Berlin’s “Mietendeckel” law or rent cap “violates the Basic Law and is thus ruled void” according to the Federal Court’s decision. This has implications for many tenants (up to 1.5 million) in Berlin, who have been paying reduced rent since February 2020. What tenants must now consider: 1. There is no immediate possibility of termination leases because tenants have complied with applicable law. However, there is an immediate obligation to repay the difference (see 3.). 2. Consensual agreements without shadow rent, for example in the case of new leases, are valid. 3. Where otherwise effective civil law agreements on the amount of rent existed, these must be fulfilled within a reasonable period (14 to 30 days). This means that the retained rents on the basis of the rent cap are to be repaid. The repayment is due upon knowledge of today’s decision of the Federal Constitutional Court. A demand for payment by the landlord is desirable, but may not be necessary in a lot of cases. Those tenants which are unable to pay the outstanding amounts immediately should contact the landlord and if necessary request financial aid from the Berlin Government. 4. In the case of shadow rental agreements after re-letting, the tenants’ association strongly advises seeking advice. Read also: 24 questions and answers on the “Eversal of the rent cap” (in English language).

Source: https://www.berliner-mieterverein.de/mietendeckel/the-berlin-rent-cap.html

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