A lid for every pot? No such luck!

Last week, the Federal Constitutional Court annulled Berlin’s “Mietendeckelgesetz”, or rent freeze law. The state law is unconstitutional because the federal government regulates rental law. Not only does this have consequences for tenants, who may now face rent adjustments or possible repayments – the change in the legal requirements also means technical and administrative adjustment effort for housing companies.

The story so far – the rent freeze and its technical implementation

On 23 February 2020, regulation of legal requirements for rental prices (MietenWoG Bln), more commonly known as the “Mietendeckel” or rent freeze, came into force. This obligated housing companies to implement various regulations in two phases in a bid to halt the rapid increase in rents that had been occurring in Berlin’s city centre in recent years. PROMOS consult was already supporting its customers with housing stock in Berlin with the systematic implementation when the law entered into force. The necessary functionalities initially included resetting the rents to those of the effective date on 18 June 2020. In addition, the rent had to be frozen from November 2020. Here, too, PROMOS helped to determine the permitted rents, inform the tenants and implement the reduction in the system. All considerations always took place with the thought in mind of creating solutions that could be quickly and easily reversed if necessary, because from the beginning there was uncertainty about whether the law would be permanent. A procedure that is now paying off.

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