Germany’s ruling Social Democratic Party will vote on a proposal for lower limits on rent increases as a way to tackle inflation in Europe’s largest economy, according to a draft resolution reported by the Bild newspaper.
The SPD’s draft paper stipulates that rents in densely populated residential areas shouldn’t rise by more than 6% over three years, and may not exceed the local comparative rent, Bild said.
The move comes as many renters in Germany struggle to absorb the rising costs of housing along with other necessities. More than half of Germany’s households live in rented accommodation.
The SPD’s parliamentary group is expected to discuss the proposal on Monday, the first day of its caucus retreat in Wiesbaden.
Even though the German coalition’s liberal FDP party is handling issues around the residential housing market, a move by the SPD and Chancellor Olaf Scholz would undoubtedly carry weight.
Germany has a general cap for rent increases of 20% over three years and of 15% in cities where housing availability is deemed especially tight. The coalition agreement of Germany’s ruling three-party way coalition has targeted a reduction in the cap to 11%, although the to 11%, although the measure hasn’t been put in place yet.
