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Rental market regulation over the last 100 years in an international comparison

News of November 7, 2018

by Konstantin Kholodilin, Jan Philip Weber und Steffen Sebastian 

Residential rental markets regulations have become an integral part of everyday life in Germany as in almost all other countries. The strong house price and rent increases over the past decade have fueled social debate on this issue. Tenant movements worldwide are demanding tighter regulations and advocating for affordable housing as a central civil right. In contrast, those skeptical of regulation fear excessive levels will impair market mechanisms. Scientific analyses on this topic have so far often failed due to insufficient data. The present study addresses this problem and presents a unique dataset that quantifies rental market regulations. Indices for measuring regulation intensity are available for 64 countries and date back more than 100 years. The dataset enables an examination of regulation intensities and regimes in a cross-country comparison. Such a comparison shows that Germany—compared to the rest of Europe—has relatively intense rent control which has been tightened even further since 2015. The impact of these changes should be accompanied by further analysis in the future.

© DIW Berlin