The "Mietpreisbremse" How rent control in Germany works

The law on the "permissible rental amount at the start of the rental period" (§ 556d BGB), better known as the Mietpreisbremse (Rent Control), is a nationwide law that came into effect in 2015. It stipulates the maximum amount of rent a landlord can charge. According to the law, the net cold rent may not be more than 10 percent above the local comparative rent. The locally comparative rent is set out in the regional rent index (for more information on the rent index, see point 3: "How to calculate your maximum rent"). If the landlord charges more than the permitted rent, the tenant is entitled to a rent reduction.

In principle, the Mietpreisbremse applies to all tenants who live in an area with a tight housing market (§ 556d para. 2 BGB) and to federal states that have passed a corresponding regulation. In addition to Berlin, Hamburg and Munich, many other medium-sized to large cities in Germany are also covered by this regulation. The respective federal states had to publish a justification for this. Some justifications were initially judged by courts to be invalid, but a large number of them have now been corrected in conformity with the law. This is the reason why the rent control for many federal states will not be legally effective until after 2015, and in some cases not until 2020. In Saxony-Anhalt, Lower Saxony, Saarland, Schleswig-Holstein and Saxony, the Mietpreisbremse does not currently apply. You can find a detailed list of where and since when the Mietpreisbremse applies here (List is in German).

Exceptions from the Mietpreisbremse (§ 549 BGB):

1. Apartments that were rented for the first time after 01 October 2014:
Apartments that were in fact simply extended, split or merged after this date are not considered new apartments and are not excluded from the Mietpreisbremse.

2. Apartments that have been modernized at a value of approximately 1/3 of the cost of a comparable new building:
Such flats are considered "comprehensively modernised". This requires a qualitative and a quantitative element. According to official information on the average new housing construction costs per square meter from the Berlin-Brandenburg State Statistical Office, the construction of a new apartment in 2018 cost an average of €1,811 per square meter - the landlord must therefore have invested at least €600.00 per square meter in the modernization. In addition, the qualitative effects of modernization must be taken into account - simple repair measures are not included (for example, pure painting work or sanding down doors and floors). Modernisation measures in line with § 555 b BGB (German Civil Code) are basically only structural changes which, in particular, sustainably increase the utility value of the rented property or through which final energy is sustainably saved in relation to the rented property (AG Neukölln, judgement of 29.08.2018, 14 C 14/18). For example, new insulated glass windows, new facade insulation or a new, energy-efficient heating system.
According to a decision of the Federal Court of Justice (cf. BGH, NZM 2013, 141), modernisation does not apply, especially if the measures in hand are those which bring the apartment into a "generally accepted state". A condition is "generally accepted" if it is present in at least two thirds of all apartments of the same age within a federal state. This is especially true if a tenant can expect the condition created in this way as a minimum standard that allows for contemporary living (BGH, ruling of 17.12.2014, VIII ZR 88/13).
The vast majority of modernised apartments do not meet these criteria and are therefore subject to the Mietpreisbremse. The modernisation costs may then only be passed on to the tenants at an annual rate of 8 percent.

3. For apartments rented for temporary use only:
In the case of temporary leases with a duration of more than one year, it is always worthwhile to commission our legal experts to examine this requirement.
In principle, the Mietpreisbremse also applies to furnished rental apartments. However, the landlord may charge a premium for the furnishing. Many landlords set this premium too high. In most cases, it is therefore worthwhile for tenants to have their rent checked. You can use our rent calculator for this purpose.

4. Rental contracts that are older than the date on which the Mietpreisbremse came into force in the respective federal state:
It is best to check the validity of the Mietpreisbremse in your federal state. Where and since when the law applies can be found in this detailed list (For now only in German). If you check your rent with the free CONNY rental price calculator, we will take care of it for you.

5. Apartments that already had a too high rent prior to the current rental:
Important The landlord is obliged to inform you of the previous rent before signing the rental contract. Otherwise, he cannot invoke this exception afterwards.

You can easily determine your personal maximum rent in a few minutes with the free CONNY rent calculator.

If you prefer to calculate the maximum rent for your apartment yourself, you must proceed as follows:

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Search for the current rent index of your municipality/city. You can usually find it on the official website of your municipality or city.

The rent index is a table which divides the local comparative rents according to apartment size, equipment and location of the apartment (data should be taken from your rental contract). In the respective cells, a rent range and an average value are given, in which the appropriate comparative rent lies. The exact value of this range depends on the characteristics that determine the residential value. These could be, for example, a large washbasin or a tiled bathroom.

The maximum rent allowed is then the determined comparative rent plus 10 percent. Anything you pay over this amount in rent is your savings potential and can be deducted from your rent. The overpaid rent can be reclaimed until the time of your complaint. For rental contracts from April 2020 onwards, tenants even have a repayment claim of 2.5 years before the date of the complaint (You can find out what a complaint letter is in point 4 "How you can reduce your rent").

For non-experts it can be quite complicated to determine the right comparative rent. Our rent calculator will do it in a few minutes.

After you have determined your maximum rent, you must notify your landlord. The letter of complaint informs your landlord about your request to reduce the rent and should contain all relevant information so that it is clear to the landlord what you are referring to. If the landlord then refers to an exception, the tenant can demand proof of this. Landlords are often unable to prove these exceptions and, for example, may claim that apartments have been " comprehensively modernised" if they do not qualify. We have summarised the requirements that must be met in point 2 under "Exceptions from the Mietpreisbremse". Unfortunately, many landlords do not take the tenant's letter of complaint seriously, in which case a lawyer can be called in or you can use the service of CONNY. We help you to enforce your right without any cost risk or any trouble with the landlord.

We often hear that many tenants are concerned about the relationship with the landlord changing after the landlord has received the letter of complaint.

The vast majority of landlords react objectively to the letter of complaint and have a certain routine with it. Even landlords know that they are the ones breaking the law and not you as a tenant. If you have determined that you are paying too much rent, you are simply asserting your right for a fair rent. Your landlord is not allowed to terminate your tenancy for this reason or to discriminate against you in any other way. Tenants are particularly well protected in Germany, and landlords can only terminate your lease for personal use.

You have to differentiate between 2 things:

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1. Your landlord is a company (housing association):

A large proportion of all landlords in Germany are companies. In this case you are one tenant among many. Generally, they have a standardized procedure for your request and it is handled by an employee of the company. Housing companies do not have the option of terminating tenants for personal use. You can therefore invoke your right without hesitation and reduce the rent.

2. Your landlord leases the apartment privately:

In this case you enjoy the same tenant protection as with housing companies. Here, your landlord may not put you at a disadvantage either and must comply with the rent reduction. To avoid clouding your relationship with your landlord, you can inform him that you want to complain about your rent and lower it to the legal level. If you decide to enforce the Mietpreisbremse with CONNY, we will take care of the contact with your landlord professionally and amicably towards him. Our top priority is to reduce the rent and to maintain the good relationship between tenant and landlord. In the very unlikely event that your landlord should nevertheless threaten to terminate your lease, you can usually remain relaxed. There are high requirements for such a termination, which most landlords cannot meet. CONNY's contract lawyers have fended off over 95 percent of all terminations after a rent reduction for your tenants.

Why it is important to invoke your right to a fair rent:

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You save a lot of money:

On average, tenants who have enforced the Mietpreisbremse with CONNY save almost 200 euros per month. Standing up for your right to a fair rent is therefore worth it, especially from a financial point of view.

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Your social impact as a tenant:

The rent index is based on the previous year's rents. If tenants do not become active, the local comparative rents increase accordingly and drive up the maximum rents allowed for all tenants. In addition, the next tenant can no longer enforce the Mietpreisbremse if you have not done so before, as the rent cannot be reduced below the value of the previous rent (more on this under point 2 under "Exceptions to the Mietpreisbremse).

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You are not taking any risks:

As already explained above, your landlord cannot terminate you because of the rent reduction and cannot treat you differently in any other way. If your landlord still threatens to terminate your lease, CONNY will also be happy to help and you can hire one of our partner lawyers to deal with the defence of the termination.