With an ordinance that is due to come into force in May, the state government has also launched the federal government's so-called building land mobilization law in Hesse.

Hesse is thus strengthening tenant protection and housing construction, as Economics Minister Tarek Al-Wazir (The Greens) explains.

In 53 cities and municipalities with tight housing markets, new rules will apply in the future.

The district in which the rental price brake also applies was expanded by four municipalities.

Rainer Schulz

Editor in the Rhein-Main-Zeitung.

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Among other things, the conversion of rental apartments into condominiums in buildings with more than six apartments will require the approval of the respective municipality in the future.

In addition, these municipalities receive new instruments for activating building land, for example a right of first refusal for unused or only slightly developed plots of land.

In addition, they can more easily deviate from stipulations in development plans in order to allow for the addition of stories to existing buildings and for densification.

"We use every opportunity to protect tenants and boost housing construction," said Al-Wazir.

Criticism of the expansion of the rental price brake

In business associations, however, there is criticism.

"Unfortunately, the announcement of the introduction of a conversion ban in Hesse and the further extension of the so-called rental price brake to other municipalities are not good news for Hesse," says Thomas Reimann, Vice President of the Association of Hessian Business Associations.

The market interventions would exacerbate problems on the housing market because private investment in urgently needed additional housing would become increasingly unattractive.

In Frankfurt, two out of three apartments are in apartment buildings with more than six apartments.

Throughout Hesse, around 170,000 apartments in the 53 municipalities could be affected by the conversion ban.

Ulrich Caspar, Vice-President of the Hessian Chamber of Industry and Commerce, believes that this will make it more difficult for a broad section of the population to acquire property.

Owners fear a chain reaction

Reimann also criticizes the fact that the rental price brake in Hesse is being expanded from the current 49 to 53 municipalities in the future.

Since 2015, the number of Hessian municipalities with so-called "tense housing markets" has more than tripled from 16 to 53.

"Instead of continuing to intervene in the housing market, more apartments must be built," Reimann demands.

The Haus & Grund owners' association also views the conversion ban "with great concern".

"The regulation will ensure rising rents and be a setback in climate protection," says Managing Director Younes Frank Ehrhardt.

He fears a chain reaction: The ban on conversion would mean fewer condominiums on the market, which would drive up their prices.

Rising rents predicted

The buyers have no choice but to demand a correspondingly higher rent.

"The rents for new condominiums will rise in these municipalities," predicts Ehrhardt.

Because in Hesse, every second condominium is rented out and not used by the people themselves.

The ban on selling individual apartments could also prevent owners from using the proceeds to finance the costly energy modernization of the entire apartment building.

Ehrhardt therefore fears a setback in the attempt to increase the energy saving potential in existing buildings.