Berlin’s real estate market is one of the most sought-after in Germany. But what legal regulations do people who want to buy or already own a home or investment property in Berlin need to be aware of? Which laws have changed recently? And how does neighborhood protection, for example, affect the decision to buy a property?
Conversion ordinance and milieu protection
In 2020, the current conversion ordinance was extended by five years until 2025. It regulates the provisions on milieu protection in Berlin and therefore plays an important role in real estate transactions.
Due to high investments in the renovation and refurbishment of numerous residential buildings in the center of Berlin, property prices have risen significantly in recent years. This development has affected both the purchase price of a property and rental prices. The changes on the Berlin real estate market have increasingly driven gentrification. Many people can no longer afford a rental apartment in the center of Berlin, which is leading to a change in the social structures that influence the cityscape.
The conversion ordinance regulates how houses and apartments in social conservation areas may be changed and which applications must be approved for this.
Conversion protection in Berlin - The Building Land Mobilization Act
There is a growing space problem in many German cities. The center of Berlin is a highly sought-after housing market. However, more and more people want to convert former rental apartments into condominiums. To counteract this trend, the building code has been amended. With the new Building Land Mobilization Act, it is generally not permitted to convert housing. Small owners are to be protected, which is why the regulations apply to residential buildings with more than five rental apartments.
The 2022 property tax reform
If you own a property, you have to pay property tax every year. The 2022 property tax reform has resulted in changes for property owners. The reform was initiated after the Federal Constitutional Court ruled that the levying of property tax in Germany was not based on the principle of equal treatment. The changes are intended to ensure that the amount of property tax is determined fairly. The property tax reform is one of the most recent legal changes for property owners in Germany.
