January 30, 2020

Berlin Adopts Five-Year Freeze to Rein In Soaring Rents
(Bloomberg) -- Berlin’s plan to rein in the city’s rental market was approved by lawmakers, capping revenue for property owners and potentially driving investors away from the German capital. Shares in major landlords slumped.Berlin’s legislature backed measures including a five-year rent freeze Thursday, more than six months after they were proposed by the left-leaning administration. The changes will likely come into force by the end of February, though opposition parties have signaled their intention to challenge them in court.The initiative put forward by the Left party’s Katrin Lompscher, head of urban development and housing, is intended to ease the burden on tenants after a property boom caused rents to double over the past decade. The political intervention has spooked investors as a separate campaign attempts to force Berlin’s government to expropriate properties from large landlords including Deutsche Wohnen SE.“We don’t want Berlin to become a copy of overpriced cities like London and Paris, where many people can no longer afford an apartment,” Lompscher said during the debate that preceded the ballot. Out of 150 votes cast, 85 lawmakers voted in favor and 64 against, with one abstention.Deutsche Wohnen shares fell as much as 2.1% and were down 0.6% at 1:30 p.m., extending its decline over the past 12 months to about 13%. Vonovia SE, Germany’s largest landlord and owner of about 40,000 apartments in the capital, declined as much as 1%, and Berlin-based property owner Adler Real Estate AG dropped as much as 2.4%.The Christian Democratic Union -- Chancellor Angela Merkel’s party, which is in opposition in Berlin -- plans to challenge the measures in Germany’s constitutional court “as soon as possible,” according to a spokesman. That can only happen once the new legislation takes effect.The adoption of the measures “sends a fatal signal to investors,” Ulrich Lange, a deputy leader of Merkel’s bloc in the national parliament, said in an emailed statement.“What’s more, there’s a high possibility that the law will be declared unconstitutional,” Lange added. “That will create rental chaos. It cannot be emphasized enough that the only solution that will ease the pressure on Berlin’s rental market remains: build.”‘El Dorado’Michael Voigtlaender, an economist at the Cologne-based IW Institute, has also criticized Berlin’s focus on rent controls rather than encouraging investors and developers to build more affordable homes to keep pace with the city’s rapidly growing population.The government’s actions are a catastrophe that “threatens to cause considerable damage to both the housing market and Berlin as a whole,” the IW said in a recent report for the CDU. The value of some properties in the city could fall by more than 40% as a result of the rent restrictions, the institute estimates.Lompscher has dismissed such concerns. In an interview this month, she called Berlin an “El Dorado” for real-estate companies. Her department has worked closely with other German cities, and she expects Berlin’s intervention in the property market to “have consequences” within the country and internationally.Not everyone agrees, though. Vonovia this month described the rent reforms as “Berlin specific.” The company doesn’t expect the measures to be replicated by other German states “except in the unlikely event that the Federal Constitutional Court were to rule largely in favor of the legislation,” Vonovia said in a Jan. 23 note to investors.(Updates with lawmaker comment from seventh paragraph)To contact the reporter on this story: Andrew Blackman in Berlin at ablackman@bloomberg.netTo contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net, Iain Rogers, Chris ReiterFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Related Stories
Latest News
Top news around the world
Coronavirus Disease

Coronavirus disease (COVID-19) is an infectious disease caused by a newly discovered coronavirus.

Most people infected with the COVID-19 virus will experience mild to moderate respiratory illness and recover without requiring special treatment. Older people, and those with underlying medical problems like cardiovascular disease, diabetes, chronic respiratory disease, and cancer are more likely to develop serious illness.

Around the World

Celebrity News

> Latest News in Media

Watch It
'Honey Boy' Director Al'ma Harel Explains How 'Bombay Beach' Introduced Her to Shia LaBeouf
July 11, 2020
TW9HOfgdnxo
How To Craft A Skeksi From The 'Dark Crystal' Creature Creators
July 11, 2020
Ixto3tj6eVE
'The Baby-Sitter's Club' Star Momona Tamada Reveals Her Similarities to Her Character Claudia Kishi
July 10, 2020
3_crGuAKcKQ
Naya Rivera Dead at Age 33 | E! News
July 13, 2020
H__dUfO0zNM
"Sports Illustrated Swimsuit" Cover Revealed | E! News
July 13, 2020
RTnrAPbd1wA
YouTube Stars Joey Graceffa & Daniel Preda Break Up | E! News
July 13, 2020
BNGpa0XVWJc
Activist Bakari Sellers Says Black Doctors Saved Wife After Childbirth | TMZ
July 13, 2020
Ok0CS4BkHoo
TikTok Hype House's Thomas Petrou Will Migrate if App Shuts Down | TMZ
July 12, 2020
uiOmUNQuuLE
Matt Lauer Dines with Mystery Woman Before Yachting on 'Resilient' | TMZ
July 11, 2020
d8NA7ePSjbU
‘90 Day Fiancé’ cast updates: Colt, Larissa and more! | Page Six Celebrity News
July 13, 2020
ipvDqxkedm0
Naya Rivera’s body recovered on seven-year anniversary of Cory Monteith’s death | Page Six News
July 13, 2020
seDh2vD2TOc
Christine Quinn reveals Justin Hartley and Chrishell Stause went to therapy before split | Page Six
July 13, 2020
WnmMmcfFAIc
TV Schedule
Late Night Show
Watch the latest shows of U.S. top comedians

Sports

Latest sport results, news, videos, interviews and comments
Latest Events
13
Jul
ENGLAND: Premier League
Manchester United - Southampton
13
Jul
SPAIN: La Liga
Granada CF - Real Madrid
13
Jul
ITALY: Serie A
Inter Milan - Torino
13
Jul
SPAIN: La Liga
Alaves - Getafe
13
Jul
SPAIN: La Liga
Villarreal - Real Sociedad
12
Jul
ENGLAND: Premier League
Tottenham Hotspur - Arsenal
12
Jul
ITALY: Serie A
Napoli - AC Milan
12
Jul
SPAIN: La Liga
Sevilla - Mallorca
12
Jul
ENGLAND: Premier League
Bournemouth - Leicester City
12
Jul
ITALY: Serie A
Parma - Bologna
12
Jul
ITALY: Serie A
Fiorentina - Verona
12
Jul
ITALY: Serie A
Cagliari - Lecce
12
Jul
ITALY: Serie A
Udinese - Sampdoria
12
Jul
SPAIN: La Liga
Leganes - Valencia
11
Jul
ENGLAND: Premier League
Sheffield United - Chelsea
11
Jul
ENGLAND: Premier League
Brighton - Manchester City
11
Jul
SPAIN: La Liga
Atletico Madrid - Real Betis
11
Jul
ITALY: Serie A
Juventus - Atalanta
11
Jul
ENGLAND: Premier League
Liverpool - Burnley
11
Jul
SPAIN: La Liga
Real Valladolid - Barcelona
11
Jul
ITALY: Serie A
Brescia - Roma
10
Jul
SPAIN: La Liga
Real Madrid - Alaves
09
Jul
ENGLAND: Premier League
Aston Villa - Manchester United
09
Jul
ITALY: Serie A
Verona - Inter Milan
09
Jul
ENGLAND: Premier League
Bournemouth - Tottenham Hotspur
08
Jul
ENGLAND: Premier League
Brighton - Liverpool
08
Jul
SPAIN: La Liga
Barcelona - Espanyol
08
Jul
ITALY: Serie A
Roma - Parma
08
Jul
ENGLAND: Premier League
Manchester City - Newcastle United
08
Jul
ITALY: Serie A
Genoa - Napoli
07
Jul
ITALY: Serie A
AC Milan - Juventus
07
Jul
SPAIN: La Liga
Celta Vigo - Atletico Madrid
07
Jul
ENGLAND: Premier League
Arsenal - Leicester City
07
Jul
ENGLAND: Premier League
Crystal Palace - Chelsea
06
Jul
ENGLAND: Premier League
Tottenham Hotspur - Everton
05
Jul
ITALY: Serie A
Napoli - Roma
05
Jul
ENGLAND: Premier League
Southampton - Manchester City
05
Jul
SPAIN: La Liga
Villarreal - Barcelona
05
Jul
ENGLAND: Premier League
Liverpool - Aston Villa
Find us on Instagram
at @feedimo to stay up to date with the latest.
Featured Video You Might Like
-g9Qziqbif8 0vmRhiLHE2U JFCZUoa6MYE UfN5PCF5EUo 2PV55f3-UAg W3y9zuI_F64 -7qCxIccihU pQ9gcOoH9R8 g5MRDEXRk4k tudKp5Vhs3k iwWHibhssSo kQr0XHPbICM
Copyright © 2020 Feedimo. All Rights Reserved.