A Berlin landlord had sued because she had set the rent too high and, according to Germany's rent control law (Mietpreisbremse), was supposed to repay her tenant money.
A chamber at the Berlin Regional Court had also found the Mietpreisbremse unconstitutional, and therefore passed the case onto the Karlsruhe court in order to obtain a final decision.
The court then ruled in favour of the tenant's right not to pay a higher amount of rent than that specified by the 2015 law.
“It is in the public interest to counteract the displacement of less well-off groups of the population from urban districts in high demand,” said the Karlsruhe judges in a statement.
The Mietpreisbremse in its current form is able to achieve this goal, they added.
How does the Mietpreispremse work?
The Mietpreisbremse is intended to prevent rents from going through the roof in popular residential areas throughout Germany.
In certain “areas with a strained housing market”, landlords cannot set the rent for a new tenant more than 10 percent higher than the average for similar flats in the area if they don't renovate an apartment between tenancies.
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The comparative rent is determined by the rent index (Mietspiegel) for the area. In some cases there are exceptions, for example for new buildings and renovations.
At the end of 2018, the Mietpreisbremse applied in 313 of 11,000 cities and municipalities in Germany: in addition to Berlin, for example, cities such as Munich, Frankfurt, Braunschweig and Jena were also affected.
Many argue that the law is fiercely needed around Germany, especially in a handful of cities where rent has increased by 50 percent between 2005 and 2018.
The regulations on the Mietspiegel had already been improved at the beginning of the year.
Yet it was not until Sunday that the Christian Democrats (CDU) and its sister party CSU, along with the Social Democrats (SPD), reached an agreement further tightening of the the Mietpreispremse in favour of tenants.
Among other things, overpaid rent is to be reclaimed retroactively for two and a half years. In addition, the regulation, which was originally limited to five years, is to be extended until 2025.
Strained/tight housing market – angespannter Wohnungsmarkt
New buildings – (die) Neubauten
Renovations – (die) Sanierungen
Overpaid rent – zu viel gezahlte Miete
To tighten – verschärfen
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