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21/04/2021
PROMOS News
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.
What needs to be done now – the reversal
With the announcement of the Federal Constitutional Court’s ruling, initial consultation with affected customers began. The technical reversal of the rent freeze law will now be implemented in the individual project teams in a timely manner. What is the main work that has to be done here?
First of all, the rental relationships must be selected in which an adjustment of the rent was made or a new rental contract with reduced rent concluded within the scope of the rent freeze. The technical adjustment of the rents can then be carried out. PROMOS can also assist in the creation of correspondence in SAP® to inform the tenants about the new situation.
If you also need advice on the technical adjustment, please feel free to contact our competent team of consultants directly! In this way, we can guarantee a timely implementation in your company as well.
