New regulations enable faster construction projects in Berlin: first public law contract signed

New regulations enable faster construction projects in Berlin: first public law contract signed

The district mayor Emine Demirbüken-Wegner (CDU) recently signed a public contract with a client who enables the client to demolish an old house and build a new one that meets the needs of a planned family. So far, this process has been complicated due to the misuse of alienation law and the associated regulation. The regulations stipulated that if the living space is demolished, including single -family houses, the new rent should be limited to a maximum of € 9.17 per square meter and this limitation had to be recorded forever in the land register.

These restrictions led to problems for builders, since the value of their properties dropped and financing banks gave higher interest rates or no financing. The Higher Administrative Court of Berlin-Brandenburg declared this regulation as unconstitutional, whereupon the Senate Administration began to revise the rules. The Reinickendorf district is already implementing the new rules to facilitate the construction of living space.

The new rules enable the district to conclude public contracts for the initial rents with builders. There are also special regulations for builders who want to live in the new houses themselves. If the agreements are not complied with, the client threatens contractual penalties, which are reinvested into the creation of affordable living space. The district mayor emphasized the importance of fast housing construction to relieve the Berlin housing market.

This new regulations should create a balance between the protection of affordable living space and the promotion of new living space. This is intended to support builders and relieve the housing market. The signing of the first public service contract of this kind shows a step in this direction.

Source: www.berlin.de