Berlin Mietspiegel

Christiane Scholz and Sevrin Waights

The Tagesspiegel reported on the recently released “Mietspiegel 2011” for Berlin. It states an average rent of 5.21 €/s.qm. and a growth of almost 8 % since 2009. The senator for urban development, Ingeborg Junge-Reyer, trys to conciliate this finding by indicating that since 2000 the growth is only about 2.5 % per year on average. Apart from the ridiculous excuse that Munich, Stuttgart and Hamburg still have much higher rents this statistic doesn´t take one important finding from urban economics research into account – or maybe is hiding it. 

The Mietspiegel indicates local comparative rents for flats with similar characteristics. It´s developed from different housing characteristics such as size, amenities, building age and ‘neighbourhood quality’. This seems sophisticated and transparent at the first glance because everybody can find his/her ‘neighbourhood quality’ by looking up his/her own street in a table. This allows for comparisons of individual rents with the average for their level of neighbourhood quality. But within any level, if you look closely, you will find that very different rents are payed for comparable flats.

The problem is that there are only three level of neighbourhood quality and that these only take into account a limited number of characteristics. The Mietspiegel report does little to acknowledge important general findings from urban economics: The nearer a residence is located to the Central Business District (CBD) the higher are land values and accordingly rents. This is because of the scarcity of space. The same applies for the proximity to a transport station (because travel time to the CBD and other employment centres is shorter).

Hence one important pattern is concealed: downtown becomes increasingly expensive and above some social groups. It becomes some kind of exclusive residence for highly paid employees and the well off. And the innercity ring probably more and more – as Andrej Holm writes in his blog – is free of people who receive benefits. But who cares? Berlin still has around 100.000 tenantless flats! These exist mainly in the outskirts, where people who receive Hartz IV have perfect opportunity structures to improve their situation (countryside, more tenantless flats, no jobs, more beneficiaries, few neighbourhood resources). There they can live among themselves (model: banlieus in Paris) and the problem is solved. Two birds killed with one stone. Congratulations, senator!