Overview
- Ifo president Clemens Fuest answered Justice Minister Stephanie Hubig’s call to tighten the Mietpreisbremse by arguing stricter caps would worsen scarcity and curb labor mobility.
- Fuest said the burden would fall most on younger people and job seekers, who face the greatest difficulty entering tight rental markets.
- Ifo’s calculations show new-build rents average about 30% above existing rents, rising to nearly 50% in sought-after big cities.
- The institute warns rent caps can freeze the market by discouraging moves, with many tenants staying in oversized flats because downsizing often costs more.
- With housing construction described as stalled by high building costs, Ifo urges policies that spur new building and improve use of the existing housing stock, rather than tighter caps.