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Rent Cap 2.0 | Tax benefits for investments in rented housing | Reduction of modernization surcharge | Changes to German regulations related to standard rent tables

Stay informed about news and developments in the real estate sector.

Rent Cap 2.0?

Already more than six months have passed since the legislator has introduced new rules related to caps on residential rent, the so-called Mietpreisbremse (literally “rent brake”). Pursuant to these rules, increases in rent in certain regions are subject to new statutory restrictions. According to the rules, in regions with a so-called tightened/overheated resi-dential real estate market (Gebiete mit angespannten Wohnungsmärkten) the initial rent due under newly concluded residential lease agreements may not exceed the comparative local customary rent (ortsübliche Vergleichsmiete) by more than 10%, unless the rent owed by the previous tenant was higher.

You may find the complete article here

Tax benefits for the promotion of investments in new rented housing

Already in the context of a conference of the ministries in charge of construction and housing that took place in Dresden in October 2015, the competent ministers both at national as well as at federal state level had demanded that changes be brought about to the general construction policy. This demand was made against the background of challenges concerning the availability of affordable rented housing, but also with respect to the need of providing housing to refugees.
Following a proposal made by the federal Minister of construction, Ms. Barbara Hendricks (a Social Democrat), on March 9, 2016, the federal government has now approved of the report on the coalition for affordable housing and construction and the building offensive. The program inter alia provides for making available of land building, tax benefits, a simplification of construction regulations as well as funding for subsidized housing.

You may find the complete article here.

Reduction of modernization surcharge

Draft Bill related to changes in tenancy law of April 11, 2016

Despite the changes brought about by the First Act related to amendments in tenancy law which has been adopted mid-2015 (as regards the current status cf. article "Rent Cap 2.0?") the reforms relating to tenancy laws are not yet completed. Following the coalition agreement, the Federal Ministry of Justice is planning further amendments to German tenancy regulations. Recently, on April 11, 2016, the Federal Ministry of Justice and Consumer Protection published a corresponding draft bill.

You may find the complete article here.

Envisaged changes to German regulations related to standard rent tables (rent indexes, “Miet­spiegel”)

Draft Bill related to changes in tenancy law of April 11, 2016

After the introduction of new rules related to caps on residential rent, the so-called Mietpreisbremse (literally “rent brake”) which took place last year, the German legislator is now contemplating adjusting the criteria for the calculation and establishment of the comparative local customary rent (“ortsübliches Vergleichsmiete”).
At the same time, the criteria for the preparation of so-called qualified standard rent tables in the sense and meaning of section 558 d of the German Civil Code shall be set. Pursuant to the legislator, the aim of the respective amendments to the existing legal framework consists in “having the standard rent tables more accurately reflect the true amount of the comparative local customary rent”. On April 11, 2016, the Federal Ministry of Justice and Consumer Protection has published a respective draft bill related to changes in tenancy law.

You may find the complete article here.

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