The newest rent index (Mietspiegel) for Berlin has been released. For the first time, average rents in the German city have risen above seven euros per square metre per month.
Berlin’s average rents have just seen the highest increase since 2017. Published by the city's Senate on June 15, the rent index has revealed that prices in the capital have risen by an average of 5,4 percent since 2021, with the average monthly rent now costing 7,16 euros per square metre.
This is an increase of 55 cents on 2017 figures and the first time that the average rent in the city has exceeded seven euros per square metre.
Rent indexes are based on the consumer price index set by Germany’s Federal Statistical Office (Destatis) and are carried out every two years. The findings of a rent index determine if, and by how much, landlords can legally increase basic rents (Kaltmieten).
As is the case with this latest rent index, if the figures show an increase in average rents, landlords can increase existing tenants’ rents, but they are only permitted to do so once every 12 months. Speaking to taz, Urban Development Senator Christian Gaebler (SPD) said that he expects “no wave of rent increases” to follow, but said landlords will likely use the opportunity to sound out potential rent increases.
Methods used to determine Berlin’s rent indexes over the last few years are much contested between the Tenants’ Association, the Senate, research institutes and statisticians. Berlin has always used a tabular rent index to calculate rental costs. This method is cheaper than a regression rent index and doesn’t require compiling as much data, but some argue that the tabular method is not as accurate.
The 2023 rent index is based on data from the 2021 index, which was based on data from the 2019 index. This means that researchers did not collect new data on current rent levels and new data has not been drawn up for four years, the 2023 index is not therefore not "qualified".
One consequence of not using a qualified index, and instead falling back on the consumer price index, is that the same rent increase was calculated for all types of housing. Since the Tenants’ Association, Landlords’ Association and Senate could not agree on the exact calculation, the final figure was determined by the Senate alone.
Left Party critics called the move a “gift” to the Senate’s own CDU and SPD landlords. While the Berlin Tenants’ Association criticised the 5,4 percent increase, pointing out that it does not take declining real wage developments into account, it welcomed that the 2023 index would serve as a bridge before the next qualified index is published in 2024.
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