Market Analysis
Berlin rental market 2015
Berlin rent index 2015: moderate increase fuels rent cap debate
Berlin's 2015 rent index puts the weighted average rent at 5.84 euros per square metre, up 2.7% per year since 2013. Landlord associations are challenging the data.
Peter Guthmann
Senator Andreas Geisel has presented the new Berlin rent index for 2015. The weighted average rent for apartments in Berlin stands at 5.84 euros per square metre net cold rent. In the 2013 index it was 5.54 euros. That works out to an annual increase of 2.7%.
Geisel noted that rent increases in existing tenancies had been lower than many had feared.
The government's dilemma
These moderate figures put the government in a contradictory position. An annual increase of just under 3% suggests a normal market rather than the widely invoked "rent explosion." Yet the government is pressing ahead with the rent cap, which takes effect shortly. If it insists rents are rising too fast, it effectively questions the accuracy of its own rent index.
The official data suggest the overall market development is less dramatic than the political debate implies.
What the index means for landlords
The qualified rent index is the central tool for justifying rent increases up to the local reference rent. It sets the legal framework, taking into account the cap of 15% within three years. The moderate published increase may mean rent adjustments in many locations turn out lower than expected, including in sought-after boroughs such as Mitte.
Landlord associations announce opposition
Several landlord associations have announced they will not recognise the 2015 rent index, citing methodological doubts. Their criticism: the data collection does not accurately reflect reality on Berlin's tight housing market. Disputes over the local reference rent are likely to end up in court more frequently. For property owners, this means greater legal uncertainty when pursuing rent increases.