BERLIN (dpa-AFX) - The Green Party is calling for regulation of index rents linked to inflation. "Index rents are a problem we need to address," Katharina Dröge, co-chairwoman of the Green parliamentary group in the Bundestag, told the Funke Mediengruppe newspapers. "Inflation has risen so much that it will come as a shock to many tenants when the increase comes."

While it goes beyond what was set out in the coalition agreement, "we need to discuss with the coalition partners how we can regulate index rents," Dröge said. That could mean, for example, capping existing index leases and regulating new ones more harshly. "We need a solution at this point."

Earlier, Federal Construction Minister Klara Geywitz (SPD) had shown herself open to capping index rents. She could imagine linking index rents to the general development of rents or setting a cap here as well, she told the "Frankfurter Allgemeine Sonntagszeitung." However, this is not in the coalition agreement, and the FDP sees no need for action, Geywitz said. Justice Minister Marco Buschmann (FDP) had already rejected calls from the SPD for a reform of index-linked rents in December.

According to the German Tenants' Association, more and more newly concluded rental agreements are indexed to inflation. In larger metropolises on the average with 30 per cent of the new contracts in the past year so-called index rents were agreed upon, explained the tenant federation in the middle of January. For Berlin the tenant federation assumes that even up to 70 per cent of the new leases provide for an indexation.

The inflation relevant for the index rents reached last year the highest value since establishment of the Federal Republic. Consumer prices rose by an annual average of 7.9 percent./kli/DP/mis