Critics in the real estate sector vociferously condemn the prolongation of the rent freeze policy. - Critics from the real estate sector voice strong disapproval towards the expansion of rent price caps.
The federal government has extended the rental price cap until the end of 2029, a decision that's drawn critique from the real estate industry. The rental price brake empowers federal states to limit rental increase percentages in tense housing markets when new tenants move in. The maximum increment should not exceed local average rent by more than ten percent.
The extension could have far-reaching implications for the real estate sector. Critics view the rental price brake as a potential "Investmentsbremse," which may discourage new construction projects due to reduced rental income, potentially exacerbating the existing housing shortage.
Moreover, the cap on rental prices, while aimed at preventing excessive price hikes, could also limit property owners' revenue growth through rental income, possibly affecting the appeal of real estate investments.
Some economists, like Ulrike Malmendier, propose that the rental price brake might be less effective than direct financial aid to tenants, which could offer them more flexibility in managing housing costs.
While the rental price brake aims to safeguard tenants from escalating rents, its impact on the real estate industry may be complex, potentially affecting investment and construction activities.
The extension of the rental price cap until 2029, as part of the community policy, might lead to a decrease in investing and real-estate activities, primarily due to potential reductions in rental income. This volatility in the real-estate sector could prompt economists to advocate for direct financial aid to tenants as a more effective method for managing housing costs, whereas the focus on vocational training could offer alternative career paths to those considering the real-estate industry.
