Traffic light compromise: Rent cap until 2029 and “Quick Freeze”

The SPD and FDP have agreed to extend the rent cap beyond 2025. Part of the agreement, which was announced on Wednesday in Berlin by the traffic light factions and the federal government, is also a compromise on the storage of communication data for investigative purposes.

“The blockade is over,” said the SPD parliamentary group. FDP MP Thorsten Lieb said: “The coalition has agreed on the “Quick Freeze” procedure at cabinet level.” This would allow data to be stored in a legally secure and event-related manner in the future.

Extension of the rental price cap until 2029

According to the Federal Ministry of Justice, part of the agreement is the extension of the rent control in tense housing markets until 2029, as provided for in the coalition agreement. The traffic light is thus reacting to the continuing difficult situation in many housing markets, said Lieb. Where it applies, the rent cap ensures that when a new rental agreement is concluded, the rent may in principle not be more than ten percent above the local comparative rent. The respective state government decides whether the rent control applies in certain areas.

The SPD and the Greens would like to see further changes to tenancy law, some of which are also included in the coalition agreement. As a spokesman announced, no changes to the maximum increase in existing rents within a certain period of time (cap limit) or to the further development of the rent index have been agreed with Federal Justice Minister Marco Buschmann (FDP), who is responsible for tenancy law.

It is good news for tenants that the SPD and FDP have now “abandoned their mutual blockade,” said Green Party parliamentary group leader Katharina Dröge. Your group now expects that the other measures agreed in the coalition agreement will also be “addressed quickly”.

According to reports, this is unlikely to happen. “There is still a need for discussion between the coalition partners on the other tenancy law projects, in particular the lowering of the cap limit and the modifications to the rent index, given the rapidly increasing construction, repair and refinancing costs,” Buschmann told “Welt”.

No ban on index rental agreements in sight

The Minister of Justice has already made it clear that the SPD and the Greens should not consider banning index rental agreements with him. However, these were not part of the coalition agreement anyway, which was formulated at a time when the issue of high inflation was not yet so virulent.

In an index rental agreement it is agreed that if the cost of living increases, a rent adjustment of a corresponding amount is also possible. In return, the landlord waives the right to adjust the rent to the local comparative rent.

The president of the central association of the real estate industry, ZIA, Andreas Mattner, said that he assumes that after the agreement on the extended rent cap, “further tightening is now off the table.” Otherwise, housing construction in Germany could come to a standstill for years.

Data storage not without reason

With the “Quick Freeze” procedure, the data is only saved if there is suspicion of a crime of significant importance – such as murder or manslaughter. From the point of view of Federal Interior Minister Nancy Faeser (SPD), this is not enough. She recently advocated for a new, legally compliant regulation for the storage of traffic and location data from telecommunications without any reason and justified this primarily by combating depictions of sexual abuse against children. The Federal Criminal Police Office also stated: “The quick-freeze procedure offers no benefit for identifying an as yet unknown suspect if the relevant data is no longer stored or is stored incompletely at the time of the request for information.” Due to legal uncertainties, the old data retention regulation has not been used since 2017.

“The current agreement on the introduction of a quick-freeze procedure will finally implement a central demand of the Green alliance’s civil rights policy,” said the deputy chairman of the Green parliamentary group, Konstantin von Notz. The agreement represents “a move away from mass data storage for no reason and a decisive step towards a security policy that improves law enforcement and at the same time is proportionate and respects the freedom of citizens.”

Buschmann had linked tenancy law with data storage

To protect against sharply rising rents, the Greens and the SPD in the Bundestag have been calling for more commitment from Buschmann for months. When asked about tenancy law in recent months, the Minister of Justice usually replied smugly that there were other projects from the coalition agreement that had not yet been implemented – and thus his demand for the introduction of the “quick freeze” procedure underlined.

Union politician speaks of “horse trading”

“The traffic light has agreed to political horse-trading at the expense of people’s safety,” criticized CDU politician Jan-Marco Luczak. People’s safety and the protection of children against sexual abuse are being played off against affordable housing. “This is an indictment and shows that the common features of the traffic light have been exhausted.”

The Union parliamentary group’s domestic policy spokesman, Alexander Throm (CDU), said: “Ms. Faeser has failed as a minister.” The procedure now agreed upon is not sufficient to combat terrorism and child sexual abuse. “The FDP has once again asserted its concept of data protection over victim protection.”

What’s next?

Two drafts are now to be written relatively soon in the Federal Ministry of Justice: One for data storage, which will then be slightly different than the draft that Buschmann presented in October 2022 and which was met with great criticism in the Federal Ministry of the Interior. A spokesman for Minister Faeser emphasized that the demand for a precautionary, time-limited storage of IP addresses was maintained.

Since the rent cap is basically an existing regulation that is to be extended, it can be assumed that Buschmann will soon send this draft to the other federal government departments for coordination. Although the two projects have nothing to do with one another, it is likely that they will be approved by the cabinet on the same day.