Rent indexes are being further concretised
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In view of rising rents and a shortage of living space, rent indices have become increasingly important. They are used to determine the standard local comparative rent in privately financed housing and can be used to justify rent increases.
The main area of application of rent indexes is the statutory rent increase procedure, with which the landlord can demand the tenant's consent to an increase in the agreed rent up to the standard local comparative rent. Furthermore, rent indexes are an important source of information when applying the so-called rent cap in tight housing markets, the details of which are determined by the federal states. Rent indexes are also important as a guide when concluding new tenancy agreements outside the scope of the rent freeze and in the event of changes to rent levels.
Rent indexes are intended to create market transparency. They provide an overview of the local comparative rent. A distinction is made between simple and qualified rent indices. A reform of the rent index law came into force on 1 July 2022 and has been mandatory for cities with more than 50,000 inhabitants since then. The reform also defined the methodological requirements for qualified rent indices in order to ensure a legally compliant and scientifically sound presentation of the local comparative rent.
According to the legal definition, the local comparative rent is formed from the customary rents that have been agreed or changed in the last six years in the municipality or a comparable municipality for housing of a comparable type, size, furnishings, quality and location.
To further strengthen the qualified rent index, it was agreed in the coalition agreement that simple rent indices would no longer be sufficient for municipalities with more than 100,000 inhabitants and that qualified rent indices would become mandatory. In future, the customary local comparative rent is to be calculated from the customary rents that have been agreed or changed in the last seven years. Specific recommendations for action on the planned changes are currently being drawn up.
(Photo: © ChiemSeherin, Pixabay)