Berlin ban on Airbnb short-term rentals upheld by city court

Tourists planning to pop over to Berlin for a weekend break may have to give up on the hipster dream of living like a local in a spacious loft apartment, and get back into the habit of staying in an old-fashioned hotel room instead.

Airbnb and other short-term letting agencies face a bleak future in the German capital after the city’s administrative court on Wednesday upheld a de facto ban on short-term rentals, in a landmark ruling that could inspire similar restrictions in cities around Europe.

Under the ban, in effect since 1 May, people who let more than 50% of their apartment on a short-term basis without a permit from the city risk a fine of €100,000 (£78,000).

Landlords will still be able to let individual rooms as long as they use at least half of the apartment for themselves. Home exchange, where two parties agree to swap their apartments for a period of time, will also be unaffected by the ban.

The city senate has set up a website where users can give anonymous tipoffs about Airbnb usage, and officials for popular districts such as Mitte have announced they will reject 95% of permit requests.

The senate believes the ban, known as the Zweckentfremdungsverbot or “ban on wrongful use”, will help to reclaim short-term holiday apartments for the rental market amid rising property prices and a growing housing shortage.

The four property managers who had jointly lodged the first legal complaint against the ban argued the law was unconstitutional since it curtailed their professional freedom.

But the judge who rejected the complaint said: “The plaintiffs’ basic rights are not violated by the regulation and are in line with the constitution.”

Explaining the verdict, Rautgundis Schneidereit said: “The availability of affordable housing is severely threatened in the entire city of Berlin and the regulation therefore justified.”

Peter Vida, Wimdu’s head of legal, criticised the decision. “The senate has been looking for a scapegoat and now it has found one,” he said. “Over years the city failed to build enough housing, and now, just ahead of the local elections, they have found someone to blame.”

With rents rising and a population that grew by 80,000 last year, commercialised home-sharing has become a highly politicised issue in Berlin.

According to estimates by the city senate, portals such as Airbnb, Wimdu and 9flats have registered between 10,000 and 14,000 flats in Berlin – almost as many as the city builds on average each year.

While Airbnb said as many as 20,000 Berlin residents let out their apartments via its website in 2015, putting up a total of half a million visitors, the company reportedly nearly halved its Berlin listings in anticipation of the new law.

The landmark ruling comes just a week after the European commission warned governments that bans on “sharing economy” services such as Uber or Airbnb should only be used as a “last resort”.

Taxi-hailing app Uber suspended its services in Hamburg, Frankfurt and Düsseldorf last year after a German court banned the company from running services using unlicensed cab drivers, though the service still operates in Munich and Berlin.

But Berlin’s decision on Airbnb could set a precedent for similar bans not just in popular German cities such as Hamburg, Munich or Freiburg, but also in other European cities where the company faces growing political opposition, such as Barcelona and Paris.

Gracia Vara Arribas, a lawyer who advised the EU on the sharing economy, told Reuters: “Cities are closely watching each other to see what types of regulations are possible and Berlin’s verdict will surely have an impact on the behaviour of other cities.”