Over for Berlin rent caps: low-wage earners plunge into financial difficulties

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When it became known that the Federal Constitutional Court had declared the Berlin rent cap to be unconstitutional, Anna-Sofie Gerth noticed this immediately in the talks.

In the City-Station on Kurfürstendamm in the middle of the city center, which is run by the social worker, it was “every topic”.

People at her meal counter would have said that they would have to come more often now because the rent cap no longer applies.

In the City-Station, people with and without an apartment can eat cheaply.

Every day there is a stew for 50 cents.

“The majority of us are people who have slipped into old-age poverty,” says Gerth.

Hairdressers, people from the cleaning and construction industries.

Many have lived in Berlin-Charlottenburg all their lives.

“Partly in four-room apartments, some since the 1950s, which cost around 700 euros a month.

Actually a great price.

But if you have a pension of 1000 euros, that too is too much. "

Anna-Sofie Gerth knows from her professional experience: For many people in Berlin, debts of a few hundred euros are a lot of money

Source: Jan-Erik Nord

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But there is no alternative for them in the neighborhood.

"A smaller apartment in Charlottenburg costs a lot more today," says Gerth.

“They don't have their social environment on the outskirts.

So they stay in their large apartments and sometimes only heat one room to save money. "

These people have usually only saved small amounts through the rent cap.

With her clients, it is about sums between 30 and 100 euros per month, says Gerth.

“We kept telling people: put it back.

But someone who always had little can't do it. "

You now have regular guests who go to the table and to the food counter at the City-Station in order to save money for the repayment.

"That is incredibly sad." For these people, debts of a few hundred euros are a lot of money.

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Gerth says she is disappointed that people have been given false hopes.

She would have liked someone to explain the rent cover in an understandable way.

Even she, as a social worker who is familiar with official German, barely understood the letter from her landlord.

It would have been necessary for the Senate to have made it clear that the law will most likely fail - and that there will then be a repayment.

"Less hype and less hope, that would have been good."

Building Senator remains: The lid was "correct"

On Tuesday, the Berlin Senator for Construction Sebastian Scheel (left) appeared rather meekly in front of the press and announced that the Senate of the capital had decided to support people who get into financial difficulties as a result of additional rent payments with a “Safe-Living Help”.

This help is to be granted as a loan.

The Senate also wants to discuss in which cases this loan will be converted into a grant.

Ten million euros are available for this.

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He was surprised that the Federal Constitutional Court tipped the rent cap.

“The verdict came unexpectedly for us,” says Scheel.

"We could not have foreseen it in this sharpness." But he sticks: "The rent cap was correct."

It will be especially tough now for people who have got into financial difficulties as a result of the pandemic.

For Benjamin S., for example.

He is a musician and sings in the Kalthauser solo project.

Musician Benjamin S. does not know how to settle his debts resulting from the rent cap

Source: Benjamin S.

He has hardly any income due to the pandemic.

He earns a little extra from a start-up for which he designs beats.

He receives top-up benefits from the job center and thus has around 1,400 euros a month at his disposal.

When it's going well.

When he broke up with his girlfriend last year, he suddenly found himself on the street with his dog.

“It was very difficult to find an apartment,” he says.

The supply of rental apartments in Berlin halved last year - due to the rent cap.

This is shown, among other things, by a study by the German Institute for Economic Research.

Benjamin S. finally rented a ground floor apartment in Schöneberg, 47 square meters for 1065 euros, without sun and with paper-thin walls.

It belongs to the real estate company Akelius.

The rent cap has reduced the rent to 460 euros.

Benjamin S. thought that the lid wouldn't stay.

But he hoped that at least no back payment would be due.

"They can't pass a law like that, and suddenly it no longer applies," he says.

The back payment has now totaled 6400 euros.

He doesn't know how to settle it.

"Many used the money saved in the pandemic"

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"The rent cap has led to great uncertainty," says Ulrike Kostka, director of the Caritas Association for the Archdiocese of Berlin.

“People are now in a particularly difficult situation: They have to repay the rent saved immediately, and they can also expect a rent increase.

Then there is the financial burden of the pandemic. "

Caritas had approached the Berlin Senate “x times” that it was necessary to work out a plan B in the event that the rent cap fails before the Federal Constitutional Court.

"But there was no willingness to talk."

Ulrike Kostka from Caritas attests that the Berlin Senate is not willing to talk

Source: picture alliance / dpa

A lot of people who don't need it would have benefited from the rent cap, says Kostka.

“But in the consulting practice we have already seen that poorer people have also won.” The repayments are now particularly hard on people who are just above the basic security and who already have low reserves.

“Many did not put the money saved aside.

Or they needed it in the pandemic. "

It is now important that people take advice and not be ashamed.

Kostka hopes that some landlords will cancel the tenants' debts.

“There are certainly small landlords who cannot do that and who are themselves in a difficult situation.

I don't want to ostracize them.

But if landlords have the means, that would be a contribution to the common good. "

One instrument that Kostka would like to see would be a program that enables people with low incomes to create property.

“It's good for the cities,” she says.

“And it protects against old-age poverty.” Cities could buy or build apartments and make them available to poorer people with a hire-purchase model.

"Unfortunately, the Berlin government is not interested in it at all."

"The best rent cap is an oversupply of apartments"

The housing cooperatives in Berlin are actors that the city actually needs to remedy the housing shortage.

The Senate has not yet shown any effective initiative for cooperation, says Thomas Kleindienst, who is on the board of the Lichtenberg housing association.

“You don't experiment with tenants,” says Thomas Kleindienst from the Lichtenberg housing association

Source: IHK Berlin

The Lichtenberg housing cooperative is one of the city's social landlords.

Many pensioners live in the prefabricated buildings, the average rent excluding heating is 5.73 euros per square meter.

Nevertheless, the rent cap hit the cooperative hard.

Over time, there was a loss of more than 800,000 euros.

"The best rent cap is an oversupply of apartments," says Kleindienst.

“The faster we can do that, the better.” His cooperative has new building plans in the drawer, but the cooperative will not implement them for the time being.

"Again we don't know what's coming."

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If the sought-after referendum on expropriation is successful, then cooperatives would also be affected.

All cooperatives that have more than 3,000 apartments are at risk.

“Why should I build a new one if I don't know whether we will keep the apartments?

It's an equation with too many unknowns. "

It was always clear to him that the rent cap would fall, says Kleindienst. Nevertheless, they had to lower the rent of almost 4,000 apartments - and now increase them again. “The Senate wanted to do an experiment,” says Kleindienst. "But you don't make experiments with tenants."