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Forward to the past: short-term effects of the rent freeze in Berlin

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Authors and Corporations: Hahn, Anja M. (Author), Kholodilin, Konstantin (Author), Waltl, Sofie (Author)
Other Authors: Kholodilin, Konstantin 1974- [Author] • Waltl, Sofie 1989- [Author]
Type of Resource: E-Book
Language: English
published:
Berlin DIW Berlin, German Institute for Economic Research 2021
Series: Deutsches Institut für Wirtschaftsforschung: Discussion papers ; 1928
Subjects:
Source: Verbunddaten SWB
Lizenzfreie Online-Ressourcen
Description
Summary: In 2020, Berlin enacted a rigorous rent-control policy: the “Mietendeckel” (rent freeze), aiming to stop rapidly growing rental prices. We evaluate this newly enacted but old-fashionably designed policy by analyzing its immediate supply-side effects. Using a rich pool of rent advertisements reporting asking rents and comprehensive dwelling characteristics, we perform hedonic-style Difference-in-Difference analyses comparing trajectories of dwellings inside and outside the policy’s scope. We find no immediate effect upon announcement of the policy. Yet advertised rents drop significantly upon the policy’s enactment. Additionally, we document a substitution effect affecting the rental markets of Berlin’s (unregulated) satellite city Potsdam and adjacent smaller municipalities. On top, the supplemental quantity analyses reveal a stark reduction of the number of advertised rental units hampering a successful housing search for newcomers, (young) first-time renters and tenants aiming for a different housing opportunity.
Physical Description: 1 Online-Ressource (circa 45 Seiten); Illustrationen