Courts across Europe are increasingly ruling that landlords have no constitutional right to maximum profits from rental housing — a legal shift that a new academic paper argues represents a broader counter-movement against neoliberal property politics.
The paper, published in the German Law Journal by University of Bologna legal scholar Francesco Lucherini, examines how housing affordability crises in major European cities are reshaping constitutional law around property rights. Its central finding: European courts are converging on the principle that housing speculation is not constitutionally protected, and that rental profitability can be legitimately curtailed in the public interest.
A continent of renters in crisis
The paper documents the scale of Europe’s housing problem. Approximately 31 per cent of the EU population lived in rented housing as of 2022, with Berlin leading at over 80 per cent. EU urbanization is projected to increase from 75 per cent to nearly 84 per cent by 2050, intensifying pressure on housing markets in major cities.
At the same time, factors including mass tourism, short-term rental platforms, foreign investment, and student mobility have driven rents sharply upward, accelerating gentrification and displacing low- and middle-income residents from inner neighbourhoods to peripheries.
Courts rule maximum profit is not a right
Lucherini identifies an emerging legal consensus across multiple jurisdictions. Germany’s Federal Constitutional Court, in upholding the country’s 2015 national rent control law (the Mietpreisbremse), ruled that a landlord’s freedom to economically exploit property does not extend to claims of maximum profit. Spain’s Constitutional Court reached a similar conclusion in January 2025, finding that nationwide rent controls only “marginally” affect constitutional property rights and that “housing speculation” finds no protection under the Spanish constitution.
The European Court of Human Rights has likewise held that rent ceilings are constitutionally problematic only when they are so low as to undermine the basic economic viability of a property — not when they merely reduce profits.
The author calls this principle “profitability relativism” — the idea that rental income can be constitutionally recalibrated against public interest mandates like affordable housing, so long as landlords can still cover maintenance and taxation costs and earn modest returns.
Berlin’s rent freeze: struck down, but not on substance
The paper revisits one of Europe’s most closely watched housing experiments. In 2019, Berlin enacted the Mietendeckel, a rent freeze that capped rent levels across the city with increases limited to 1.3 per cent annually beginning in 2022. The law was struck down by Germany’s Federal Constitutional Court in March 2021 — but not because rent freezes violate property rights.
Instead, the court ruled that rent control falls under federal civil law jurisdiction, meaning Berlin’s state government lacked the constitutional authority to legislate in the area. The existence of the federal Mietpreisbremse blocked any state-level alternative. The decision effectively foreclosed municipal-level democratic engagement with rent policy in Germany.
Spain’s regional rent controls overturned, national ones upheld
A similar dynamic played out in Spain. Catalonia enacted its own German-inspired regional rent control in 2020, but Spain’s Constitutional Court struck it down, ruling that civil rent regulation belongs to centralized national competence. Yet when Spain passed a national rent control law in 2023 (the Ley de Vivienda), the same court upheld it in 2025, finding the social function of property and the constitutional right to housing justified the restrictions.
The pattern, Lucherini argues, reveals a fundamental tension: housing crises are concentrated in specific cities and neighbourhoods, but the legal authority to address them typically sits with national governments.
Short-term rentals and brokerage fees
The paper also tracks regulatory responses to short-term rental platforms and housing brokerage fees across Europe. Berlin’s 2013 prohibition on converting residential housing to short-term rentals was upheld by German courts as consistent with property’s “social binding” under the constitution. Spain’s Supreme Court ruled in 2024 that homeowner associations can ban short-term rentals without violating property rights. The European Court of Justice upheld Paris’s requirement for preventive authorization of short-term lets, recognizing “combating rental housing shortage” as a valid public interest.
On brokerage fees, Germany, Austria, Spain, and France have all moved in recent years to shift costs from prospective tenants to landlords — a principle known as the Bestellerprinzip or “customer principle.” Austria’s Constitutional Court upheld the measure in February 2025, emphasizing the goal of facilitating access to adequate housing for middle- and low-income groups.
The limits of local action
Lucherini frames these developments as a “countermovement” within European constitutionalism — an attempt to re-politicize and democratize housing regulation against the depoliticizing tendencies of neoliberal governance. But he cautions that the movement faces a structural problem: cities, where housing crises are most acute and where progressive housing politics tend to find the most support, remain constitutionally weak relative to national governments.
“Affordability and gentrification problems remain perpetually dependent on national political will,” the author writes, arguing this “condemns cities to persistent delays in policy response.”
The paper calls for reimagining the relationship between cities and national legal orders, and for empowering local authorities with greater constitutional and legislative tools to address housing crises on their own terms.
Source: Lucherini, F. (2026). “The Housing Challenge to Neoliberal Homeownership: Profitability Relativism and Governance Asymmetry as Post-Neoliberalization.” German Law Journal, Cambridge University Press. DOI: 10.1017/glj.2026.10175
