Germany Is Building a Wall to Protect the Berlin Wall

An effort to limit damage done to the Cold War landmark by tourists.

Souvenier-seeking tourists have done serious damage to the Berlin Wall, leaving Germany with no choice: A wall in front of the wall will be erected in summer 2018, to protect the landmark structure from further vandalism, reports the Art Newspaper.

This isn’t the first time the idea of a protective barrier in front of the Berlin Wall has been raised. In November 2015, authorities of Berlin’s Friedrichshain-Kreuzberg district, home to the “East Side Gallery” section of the wall, which is covered in murals created in 1990, announced plans to erect a permanent protective fence.

The wall, a designated heritage site, was erected in 1961, dividing citizens of West Berlin from the rest of the city and the surrounding East Germany until November 9, 1989. The wall began coming down in June 1990, but parts of the structure were left intact as a monument.

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Look out, London. Berlin’s startup scene is ready for a Brexit bonanza

Startups that previously looked to London are being wooed by Berlin’s fast-developing scene. But can Germany capitalise on Brexit uncertainty?

At a co-working space on Friedrichstraße, Berlin’s startup economy is getting ready for Brexit. Mindspace’s first location in Germany, opened in April 2016, sits in the heart of Berlin’s Mitte district, flanked by high-end fashion shops and perfumeries. Its walls are adorned with hand-stencilled signs directing people, in English, to the “yummy kitchen” and “awesome offices”. It feels exactly like the startup scene in London – and that’s deliberate. What London stands to lose after Brexit, Berlin hopes to gain.

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“Berlin is starting to be considered as a startup ecosystem, particularly targeting the tech startup scene,” says Nijvenko. The company’s “official language”, she explains, is English. All signs, documents and posts on the community’s private Facebook group are auf Englisch. Its co-working spaces bare an uncanny resemblance to a template Silicon Valley, faux-hipster style – superfluous clocks; plush, well-worn armchairs; Communist-era televisions; and work from local artists adorn almost every remaining inch of space. Around 760 members pay between €250 and €450 per month (£215 and £390) to use the space, with the two additional sites in Berlin upping capacity to more than 2,000 people. Business is booming. “The political incentives right now are targeting the startup ecosystem. Berlin is very affordable, so for startups it’s the best place to be,” says Nijvenko.

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Berlin Workers seeking Home away from Home

Short term employment contracts on the rise as Berlin booms
Millenial contract workers seeking home comforts face reduced options since AirBnB ban

An interesting survey was recently conducted by a travel expenses company showing that alternative options for business travel were becoming increasingly popular and that Berlin was the fifth most popular business travel destination across all cities in the UK, France and Germany.

Given that we are in a day of disruptive innovation, it is no surprise that workers, as much as tourists, want to stay in less conventional accommodation or locations when they travel and use platforms such as AirBnB to find them.

It might be for the home comforts of a bedroom, lounge and kitchen or to get a better sense of the area in which they’re staying. It may simply be to save money. Unfortunately for Berlin, these options have been on the decline since the restrictions brought in last year, making it harder for short term contractors looking for a home away from home.

There is a real possibility that the city of Berlin will become the victim of this change. It’s a burgeoning city with falling unemployment, a rising population, strong educational facilities and significant investment into the city’s infrastructure. The tech companies are arriving and booming, new industries are opening up; as a united city it is still in its infancy, but we mustn’t forget that it is a capital city and to fuel its growth it needs to provide flexible solutions to maintain social mobility and give entrepreneurial companies the opportunity to grow.

This means, as much as anything, providing affordable accommodation for short term workers, often drafted in to fill skills gaps for specific projects or corporate objectives. The recent survey made it clear that whilst hotels were still popular, the demand for alternatives from Millenials in particular, is driving a booming market in alternative business accommodation.

Hotels, as much as they try to evolve, still lack basic home comforts. Hotels will forever sit firmly on the side of tourism and short-term travel, not residence, and many young contract workers want to feel as if they are living in the real Berlin, in a comfortable apartment that has been furnished like home, with their own food in the fridge, neighbours to speak to and local amenities to enjoy. If Berlin doesn’t fill the gap in supply for such accommodation, Berlin’s industries will struggle to bring in the talent they need for the time they need it. Six months of living in a hotel is not what many workers want these days, not to mention the exorbitant cost for the company.

Companies like AirBnB have launched into business travel successfully but Berlin’s restrictions are making it harder for the city’s companies to house short term workers. The situation is exacerbated by the fact that many landlords are seemingly unaware of the option available to them to provide short term, furnished accommodation to the city’s workers through alternative means, such as Buy Berlin’s Corporate Furnished Service.

If landlords fully furnish their apartments, they can be rented out to companies seeking fixed, short term rental contracts for their employees. The tenancy agreement is different to your standard tenancy, allowing landlords to have more control over their property and the rental price. It is a highly successful model that benefits all parties involved and is proving particularly popular in city centre districts and those located near to major project hubs, such as the airport.

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BuyBerlin

Buy Berlin Investments is an independent property company that provides turnkey services to global investors, both individual and institutional, who wish to purchase real estate in Germany’s capital city, Berlin.

Established over ten years ago, the company recently expanded into Asia with the opening of its Hong Kong office, providing on the ground customer service in English, German and Chinese.

BuyBerlin supports its clients every step of the way – it seeks the very best properties, assists investors through the intricacies of financing, taxation and German legalities, and provides ongoing asset management in the form of property management, rentals, furnishings and eventual resale.

Berlin’s AirBnB landlords find alternative option for lettings

Corporate furnished letting service is ideal for landlords with city centre apartments affected by the crackdown on short term rentals
Tenancy contracts from three months plus higher yields make this an attractive alternative


It has been nearly nine months since the Berlin government initiated a ban on the majority of short term rentals in the country’s capital. The ban was deemed necessary to help manage what was seen to be Berlin’s escalating rental prices and to support the city’s hotel industry, for which the likes of AirBnB and Wimdu were getting the blame.

With approximately 12,000 rooms available at the time, the vast majority were concentrated in the most popular districts of Berlin, the same areas where many short term workers seek convenient apartments whist working in the city.

Darrell Smith, founder and director of estate agency Buy Berlin, explains that workers who are forced to stay in hotels or serviced apartments for the duration of their contract are the ones suffering the most from this change. “Having a place to stay that feels like home when you’re working in different cities around the world is what online platforms such as AirBnB were so effective at supplying. Despite the new legislation, these apartments can still be made available. What many landlords do not realise is that they can offer their furnished apartments to professional tenants on a short-term basis without facing the rental price restrictions of long-term contracts and can earn considerably more income as a result.”

There are significant benefits to this model; landlords can charge whatever rent they feel is appropriate. As an example, a typical one bedroom apartment of 55 square metres would generate EUR1,375 per month, nearly double what an equivalent unfurnished apartment would fetch. The contracts can be from three months to one year and the rent is packaged with a mandatory monthly clean, which the tenant must pay for.

Buy Berlin has seen a sharp increase in enquiries for corporate lets as Berlin continues to grow as an economic powerhouse, drawing in more business and more people. Smith continues, “Expatriates are looking for centrally located properties which are renovated or in very good condition and vary in size from 30 square metres to 100 square metres. Typically they work for multinational companies (CAC 40, Fortune 500) that often pay the rent for the tenants. We also work with relocation companies on behalf of their clients, and film companies are frequently in contact given that Babelsburg film studio is so near to Berlin.”

The most popular apartments are those found in the most centrally located districts such as Mitte, Prenzlauer Berg, Friedrichshain, Kreuzberg, Charlottenburg and Wilmersdorf.

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Berlin’s AirBnB Vermieter finden eine Alternative

Möblierter Vermietungsservice für Berufstätige ist ideal für Vermieter mit City-Center-Wohnungen, die von der Regulierung kurzfristiger Vermietungen betroffen sind.
Mietverträge ab drei Monaten und höhere Erträge machen dies zu einer attraktiven Alternative.


Es ist nun fast neun Monate her, seitdem die Berliner Regierung ein Verbot fast aller kurzfristigen Vermietungen in der Bundeshauptstadt ausgesprochen hat (Zweckentfremdungsgesetz). Dieses Verbot wurde als notwendig angesehen, um dabei zu helfen, die Hotelindustrie der Stadt zu stützen und die Berliner Mietpreise zu regulieren. Hierbei wurde in der Hauptsache die Nutzung von bereits jetzt schon zu knappen Wohnraum für kurzfristige Vermietungen, z.B. an Touristen unterbunden, für deren Eskalation unter anderem die Vermietungsportale AirBnB und Wimdu mitverantwortlich gemacht wurden. Das große Ziel dieses Gesetzes soll sein, den vorhandenen Wohnraum auch allen Mietern langfristig zur Verfügung zu stellen, um so den chronischen Wohnraummangel in Berlin einzudämmen.

Die überwiegende Mehrheit der zur damaligen Zeit etwa 12.000 verfügbaren Zimmer konzentrierte sich auf die beliebtesten Bezirke Berlins und wurde größtenteils an Touristen vermietet. Diese Gebiete sind die Gleichen, in denen viele Pendler möblierte Wohnungen während ihrer Beschäftigung in der Stadt suchen.

Darrell Smith, Gründer und Direktor des Immobilienbüros BuyBerlin Investments, erklärt, dass Berufstätige, die für die Dauer ihres Arbeitsverhältnisses gezwungen sind, in Hotels oder möblierten Wohnungen unterzukommen, diejenigen sind, die am meisten unter dieser Veränderung leiden. “Einen Raum zu haben, der sich wie ein zu Hause anfühlt, wenn man in verschiedenen Städten auf der ganzen Welt arbeitet, ist, was Online-Plattformen wie AirBnB so gezielt anbieten können. Trotz der neuen Gesetzgebung können diese Wohnungen noch verfügbar gemacht werden. Was viele Vermieter nicht wissen, ist, dass sie deutlich mehr Einnahmen erzielen können, indem sie ihre möblierten Wohnungen kurzfristig berufstätigen Mietern anbieten, ohne dabei von Mietpreisbeschränkungen langfristiger Verträge betroffen zu sein.”

Es gibt erhebliche Vorteile für dieses Modell, unter anderem können Vermieter jegliche Miete verlangen, die sie als angemessen betrachten. Als Beispiel würde eine typische Ein-Zimmer-Wohnung mit einem 55m² Schlafzimmer EUR 1.375,00 pro Monat Miete kosten; fast doppelt so viel als eine gleichwertige unmöblierte Wohnung kosten würde. Die Verträge können von drei Monaten bis zu einem Jahr dauern und der Mietvertrag kann auch eventuelle Service-Leistungen, wie z.B. eine obligatorische monatliche Wohnungsreinigung, für die der Mieter zu zahlen hat, enthalten.

BuyBerlin Investments verzeichnet einen starken Anstieg von Anfragen für Vermietungen an Berufstätige, während Berlin weiterhin als wirtschaftliches Zentrum wächst, welches immer mehr Unternehmen und Menschen anzieht. Smith fährt fort: “Auch Auswanderer suchen nach zentral gelegenen Immobilien, die renoviert oder in sehr gutem Zustand sind und in der Größe zwischen 30m² bis 100m² variieren. Meist arbeiten diese für multinationale Unternehmen (CAC 40, Fortune 500), die oft die Miete für Ihre auswärtigen Angestellten zahlen. Wir arbeiten hier z.B. mit Umsiedlungsgesellschaften, die im Namen ihrer Kunden agieren, aber auch Filmfirmen sind häufig mit uns in Kontakt, da das Babelsberger Filmstudio so nah an Berlin ist.”

Die beliebtesten Appartements liegen in den zentral gelegenen Bezirken wie Mitte, Prenzlauer Berg, Friedrichshain, Kreuzberg, Charlottenburg oder Wilmersdorf.

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Scotland to set up Berlin office to boost trade links after Brexit

By Elisabeth O’Leary
GLASGOW, Scotland Oct 15 (Reuters) – Scotland will set up a trade office in Berlin, boosting its trade departments in readiness for all possibilities, including Scottish independence, after Britain leaves the EU, First Minister Nicola Sturgeon will say on Saturday.
The Scottish National Party leader has raised the nation’s profile since June’s European Union referendum in Britain, seizing on a new openness towards Scotland in Europe since most of its population voted to remain in the bloc.
Britain as a whole, however, voted to leave, a clash which has reignited talk of a split between Scotland and the rest of the United Kingdom, even though Scots rejected separation just two years ago.
“Creating jobs, expanding the economy and growing tax revenues – these priorities must be at the centre of everything we do,” Sturgeon will tell the SNP conference at its close, according to a draft of her speech.
She will add that economic stability is threatened by the prospect of the UK leaving the European single market, taking Scotland with it. Scotland wants to keep as many of the advantages of single market membership as it can, even if Britain leaves, and is looking for a bespoke deal with London to do so.
British ministers have suggested that the UK could leave the EU’s single market for goods and services to let them reimpose stronger control over their borders. The comments have driven the pound to its lowest level in three decades.
Sturgeon will say that in order to protect business in Scotland, the devolved government will set up a board of trade, a new trade envoy scheme, expand its Scottish enterprise agency and establish a Scottish trade hub in Berlin.
Business minister Keith Brown has said that he has seen a more neutral stance from businesses who were opposed to independence in the past but are supportive of Scotland’s desire to stay in the single market.
“After the (political) mess that has followed the (Brexit) vote, business is desperate for clarity and leadership,” Kate Forbes, a Scottish lawmaker at the conference, told Reuters.
She said that businesses are positioning themselves for all options after Brexit.
Sturgeon announced on Thursday that the Scottish government would publish a blueprint next week for a possible new independence vote. However, she has not said if or when the bill would be presented formally to the Edinburgh parliament.
Support for independence has barely moved since Scots rejected it by a 10 point margin two years ago. But the conference supported a motion on Friday which said Scotland “should prepare for a second independence referendum and seek to remain in Europe as an independent country.” (Reporting by Elisabeth O’Leary; Editing by Andrew Bolton)

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Berlin rising for residential

By Mike Hilton
It’s easy to forget quite how young Berlin as a capital city is. It is still less than 30 years since the demolition of the Berlin Wall, a defining moment in modern European history, perhaps matched only by the UK’s decision to leave the EU.

Since then, the city has grown rapidly: the economy, employment and income have accelerated, with little signs of slowing down as shown by Property Week’s recent report into the city’s post-Brexit opportunities.

Now firmly entrenched as the country’s political centre, business is growing in all sectors, helped by an increasing culture of entrepreneurship.
This has led to strong employment growth which is outstripping the rest of Germany and causing many to flock to the city. Last year Berlin’s population grew by 47,000 and this year is set to eclipse that with 42,000 moving to the city in the last six months alone.
This influx of people, 60% of which were from other European cities, has put even greater pressure on the supply of housing in the capital and a significant supply-demand imbalance now exists.

There are other factors adding to this shortage of housing; in Berlin there is a clear trend towards single person, rental households with an average of 1.8 people per apartment, with around 80% renting. If you were to combine this with the population growth, the calculated new demand sits at around 20,000 new units per annum in order to satisfy the city’s needs.

Slow rate of supply
However, since the early 1990s, there has been virtually no privately financed construction and the rate of new supply continues to fail to meet the considerable demand for homes. 7,000 units were built in multi-family homes in 2015, the majority of which were condominiums at higher price levels.

Condominium prices have doubled since 2010 and by almost 10% in the last year to €3,320. Both are still far below the price levels of other European cities, with a lot of catching up to do – rents for example are still only a quarter of the price they are in London.

Over the last eight years that Phoenix Spree have been investing in Berlin’s residential market, there has been considerable investor interest in the market, attracted by the mix of stable income growth, the potential to modernise and to capture the uplifts from reversionary rental growth as well as the opportunities for increased returns provided by sub-dividing multi-apartment assets for condominium sales.

However, the market remains very fragmented as many buildings remain in private ownership and in need of extensive refurbishment. This, combined with the potential for growth, property values below the cost of construction, underpinned by low interest rates, investor interest remains healthy. It’s no surprise.

Berlin, after years of relative inactivity, is still healing from the effects of its reunification, but is one of the most exciting European cities.

Mike Hilton, Phoenix Spree founding partner

Singapore Startup WB21 to Leave London for Berlin After Brexit

Three months after Britain’s vote to leave the EU, seven firms are moving from London to Berlin

BERLIN—Singapore’s fintech firm WB21 Pte. has decided to move its European head office from London to Berlin, one of the first startups to quit the U.K. in favor of the German capital after Britain’s vote to leave the European Union.

“Brexit was decisive for us. We had initially planned to operate our European business out of London, but the decision means we lack legal certainty there,” said Chief Executive Michael Gastauer on Friday.

WB21, which launched late last year as a payment service provider, said it would create 200 jobs in Berlin that were initially slated for London. Of WB21’s current 25 positions in London, 20 will go to Berlin. The fintech startup, based in Singapore, offers accounts and international money transfers. As of mid-September, it counted 1 million customers and had sent cross-border payments totaling more than $5.2 billion.

The Brexit decision in June fed expectations that companies with U.K. operations could relocate to avoid losing access to the EU single market, and a number of cities began lobbying companies, including Frankfurt, Paris and Dublin. According to accounting firm KPMG, three-quarters of British chief executives are considering moving headquarters or some operations from the U.K. in response to the Brexit vote.

But an exodus hasn’t materialized, with most decisions pending the outcome of negotiations on the relationship between the U.K. and the EU, which have yet to begin. In addition to uncertainty about trade and business conditions, companies have questions about taxation, labor law and infrastructure elsewhere.

Berlin, which has focused on wooing startups, recently redoubled its efforts to attract companies from London. Right after the Brexit vote, the city’s economics ministry began lobbying hundreds of companies by email, and this month set up a contact office in London.

Three months after the vote, six​ companies have decided to move operations to Berlin, ​besides​ WB21, said Stefan Franzke, head of Berlin Partner, the agency that runs the London office. Among them are real-estate investment platform BrickVest Ltd, web-design company MBJ London Ltd., and finance firm Swissbank Ltd., he said.

The agency is in talks with about 40 other companies about possible relocation, he said.

WB21 expects to get a German banking license in the coming months, allowing it to expand its product portfolio and offer loans, savings accounts and investment products to clients internationally.

“Instead of going through the licensing process and building a bank in the U.K., and then in three or four years perhaps not knowing if we can use it Europe-wide, we decided to come to Berlin,” said Mr. Gastauer. He said Berlin was more attractive than some other places in Europe because Germany’s status as a founding member of the EU made it unlikely to abandon the bloc, he said.

The company called Berlin “one the fintech-friendliest cities in Europe” and said the availability of qualified personnel also made it attractive.

WB21, which stands for ’web bank 21st century,’ plans to invest €50 million in the German capital.

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Munich at high risk of housing bubble: report

Considering buying property in Munich? This report might make you think twice

Swiss investment bank UBS wrote in a new report on Tuesday that the Bavarian capital had the fifth most overvalued property market in the world, while also considering Frankfurt properties to be bad investments.

Vancouver was considered to have the biggest property bubble, followed by London.

The report examined 18 cities around the world and concluded that six of them were at risk of a housing bubble. Making up the rest of the top-six were Stockholm, Sydney and Hong Kong.

It noted that low interest rates in Europe had contributed to an “overheating” of markets for urban residential properties, particularly in London, Stockholm, Munich and Zurich.

“Germany’s economic boom and very expansionary monetary policy ended 20 years of real house price stagnation in 2010. Subsequently, Munich property prices rose by double digits and have increasingly lost touch with economic fundamentals,” said the report, noting that it now takes a skilled-service worker seven work years to buy a 60 square-metre flat – “an all time high”.

A little further north, in Germany’s finance capital on the Main river, property prices are also once again on the rise.

“Following a breather in 2013, Frankfurt too is showing clear signs of picking up momentum,” the report states.

It goes on to warn that it is impossible to predict exactly when a “correction” will take place in the markets.

“A sharp increase in supply, higher interest rates or shifts in the international flow of capital could trigger a major price correction at any time,” it states.

Over the past year Munich’s real estate prices in Munich – already the highest in Germany – have continued to rise sharply.

Whereas in October 2015 a 60 square-metre apartment cost €6,200 per square-metre, those buying now will have to dish out €6,700 on average, according to online real estate agent Immowelt.de.

In Frankfurt prices have changed relatively little, rising moderately from €3,500 per square-metre to €3,600 in the same period.

In Berlin, property prices still remain well under half those in Munich. A 60 square-metre apartment in the German capital would currently set a wannabe homeowner back €3,100 on average.

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Time To Buy German Real Estate?

A few weeks ago, analysts over at Source Multi Asset Research published a research note highlighting the attractiveness of real estate investment trusts.

Source presented data which showed that year-to-date, real estate (the FTSE EPRA NAREIT index) has been the best performing global asset with a USD total return of 12.6%. Within the US the return is 16.5%, which beats equities, Treasuries, and credit.

But the argument for REITs as an asset class doesn’t stop at the beginning of this year. Indeed, Source analyzed nearly two decades of data and found that real estate had outperformed equities, Treasuries and high-yield since 2000 — almost 16 years of outperformance. The FTSE EPRA NAREIT has generated 2.5 times the return on stocks since 1990. Since 1990 real estate has produced a total return of 13% per annum versus 9.4% equities.

Still, the performance of REITs is dependent upon the performance of the asset class underlying the instrument. REITs will only outperform the wider equity market if real estate markets remain buoyant. With property values looking frothy in traditional real estate investment markets such as London, New York, and Hong Kong investors now seem to be taking a cautious approach to buying in the sector. Nearly a decade of ultralow interest rates has pushed up property values around the world as investors have charged into the asset class seeking high, and stable returns in an uncertain market.

Analysts over at Jefferies believe that there is one real estate market in Europe that is on the cusp of a renaissance after lacklustre returns from the sector for the past few years.

Time to buy German real estate?

A combination of wage growth, negative bund yields, dormant inflation and a booming current account surplus is priming the German real estate market for a demand boom according to Jefferies’ Germany Equity Strategists.

In comparison to other Western Europe real estate market, the German property market is starting from a much lower base, making the region attractive to outside investors. Further, as the country has missed out on the real estate boom taking place in other regions, the country has not been a rush to introduce measures to slow down property price growth. Another reason why the region’s is more attractive to outside investors.

Economic fundamentals are supportive of home price growth. Wages are growing faster than consumer prices and Germany is benefiting from the European Central Bank’s policy of keeping interest rates at, near or below zero.

Overall, Germany is a very attractive place to be looking for real estate at this current point in time:

“With the economy running a large current account surplus at the same time as real rates are negative should ensure that property prices are well bid. One further factor that ought to drive demand is that affordability is still good. Furthermore, the weak euro ought to mean that foreign demand for real estate is also high. Indeed on most straightforward measures of property price to income or rent, Germany comes out as inexpensive.” — Jefferies

Source http://www.valuewalk.com/2016/08/time-to-buy-german-real-estate/

Court rules small victory against Berlin Airbnb ban

A court just issued a small blow to the capital city’s ban on Airbnb-style holiday flat rentals.

A court in Berlin ruled that people with second homes in Berlin may rent out their flats to tourists in a decision that runs counter to a newly implemented ban on Airbnb-style rentals.

Berlin officials passed the ban, which went into effect in May, due to concerns about limited available housing space and rising rental prices. It forbids property owners and tenants from renting out whole flats or houses to tourists through websites like Airbnb.

Those who violate the ban face fines of up to €100,000, although hundreds have nevertheless been flouting the law.

But the court ruling on Tuesday opened up the possibility for people with only second homes in Berlin to rent out their flats to vacationers during the parts of the year when they live in their primary homes.

The three complainants who filed the challenge to the ban live in Rostock in northern Germany, Denmark and Italy.

The court said that renting out a secondary home that otherwise would not be used does not lead to a loss in living space.

“In terms of the availability of housing in the city, it doesn’t make a difference whether a secondary home is rented out or empty while the owner is away,” the court stated, adding that the three owners who complained did not show evidence of abuse of the law in wanting to rent out their Berlin homes.

The court called on neighbourhood officials overseeing the areas where the complainants own their second homes to make an exemption for them from the ban.

Berlin’s ban on the use of sites like Airbnb to rent out whole flats has been met with contention since it first came into force, with dozens of suits being filed against it.

The first legal challenge was shot down in June after four individuals tried to argue that the law ran counter to property ownership rights.

Sources: http://www.thelocal.de/20160809/court-rules-small-victory-against-berlin-airbnb-ban