Rent increase: What is allowed and what must be observed

The situation on the rental housing market continues to worsen. Asking rents have continued to rise in many places over the past twelve months. In 69 of 80 cities with more than 100,000 inhabitants, rents have increased within one year. Rent increases of up to 20 per cent within three years are permitted. An easing of the situation is not expected for the time being.  

Here you can find out the most important facts about rent increases: Anyone who has newly moved into a rented flat or has received a rent increase can rely on the rent remaining unchanged for at least 15 months. A new rent increase request can be made at the earliest one year after moving in or after the last rent increase. If the rent increase request is justified, the increased rent is due from the third month.

Rent and rent increases are regulated in the Civil Code. The landlord can adjust the rent to the level customary in the locality. The local standard is determined by the rent index of the municipality. If there is no rent index, the landlord can refer to the price of three comparable flats or to an expert opinion. 

If a rented flat is modernised, the rent can also be increased. However, the prerequisite is that the modernisation measures are actually modernisation measures - such as the installation of a lift, the addition of balconies, better thermal insulation or a solar system - and not maintenance measures, which the landlord is generally obliged to carry out. Modernisation measures increase the value of the rented property. Landlords are therefore allowed to add eight percent of the costs to the annual rent. The apportionment of maintenance costs is highly regulated. Rent increases are limited to two or three euros per square metre and month within six years. 

Due to new government requirements for energy-efficient renovation, many old buildings will have to be renovated in the coming years. So far, only about one percent of the building stock in Germany is renovated each year. To achieve the climate targets, twice as much would have to be renovated. At present, the desirable refurbishments are counteracted by the enormous increase in construction costs and high interest rates. 

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