Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/229901 
Year of Publication: 
2021
Series/Report no.: 
DIW Discussion Papers No. 1928
Publisher: 
Deutsches Institut für Wirtschaftsforschung (DIW), Berlin
Abstract: 
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.
Subjects: 
First-Generation Rent Control
Rent Freeze
Urban Policy
Rent Price
Supply Disruptions
Berlin
JEL: 
C14
C43
O18
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.