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Well, if that’s the issue, as a non German who doesn’t understand the situation or surrounding political environment very well, wouldn’t a much better solution then be to crack down on illegal hotel businesses?

Seems like this law is only going to make things worse: the rent freeze will make renting even less appealing to owners, only increasing their desire to run their property as a hotel. No?

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Rent seeking behaviour causes prices to rise making the market inaccessible to homebuyers. Making property less attractive as an investment should help curb this tendency.

Sure that argument makes some sense, but my comment was in response to the claim that the main issue is illegal hotel businesses. If that is the case, If don't see how this law can't make that problem worse.

If it is attractive to investors to run illegal hotels now, it will only become more attractive to do so once they are unable to raise rents on normal tenants.

People being willing to pay high prices to live in Berlin is what causes prices to rise. It has been a popular place to live in for a while.

Rent freeze will limit available housing and lower the quality of it.

> crack down on illegal hotel businesses?

They have already done it and recovered less than 3000 flats. Again, illegal hotels are not a real problem in this city.

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