Where Can I Discover Additional Information

Learn what the law suggests for Berlin residential or commercial property owners and property owners in our FAQ.


For which flats does the lease cap use?


Rent cap policies apply to non-public housing. Excluded from the guidelines are openly subsidised housing, social well-being flats, flats in halls of residence and recently built flats that were first all set for occupancy on 1 January 2014 or that have actually been restored for domestic purposes from uninhabitable and empty former living space that was transformed at an expense commensurate with a new building.


Commercial space that has actually been transformed and rededicated as living space at substantial expense is likewise omitted from the rent cap.
The rent cap applies to social housing which no longer falls under IBB commitment. In this case, it is not the lease on the reliable date, however the last lease concurred in the commitment period that is to be utilized as the basis.


The law says "rent in accordance with the lease cap" - what does that imply?


According to Art. 3 (4 ), rent in accordance with the rent cap indicates the net base rent (not consisting of running costs and utility costs for heating and warm water), however consisting of all surcharges for furnishings and furnishings.


In rental contracts in which no net base rent has actually been concurred, the property owner must, if needed to do so and at the demand of the qualified authorities, offer occupants with the accurate net base rent amount in addition to the information used for the estimation basis.


The length of time is the lease cap legitimate?


Can I still increase the rent now?


The crucial date for the "freezing" of the lease is the date of the Senate resolution on 18 June 2019, i.e. after the law enters force, the baseline for a re-letting is the rent that was effective on the key date.


In principle, the exact same level of rent can be concurred with the next tenant. However, this is just allowable if it does not surpass the upper lease limits under Art. 5 MietenWoG.


If the flat was not leased on the key date of 18 June 2019 or if a tenant modification has taken location in between the crucial date and the effective date of the law, the rent accepted throughout this duration will be "frozen".


Just how much lease can I charge as a property owner? In order to identify the upper lease limits, the leas noted in the 2013 Berlin Rent Index were updated to reflect real wage advancement until 2019. The upper lease limits are stemmed from the table in the rent cap law and are finished according to constructing age classes and amenities. Surcharges are likewise allowed. For flats with modern amenities, the upper limitation is increased by 1 euro. Relevant here are just those amenities supplied by the property owner. According to the law's lease table, modern amenities exists if the home has at least 3 of the five following characteristics:


The lease ceiling is also increased by an additional charge of 10% if the residential area is situated in a structure without any more than two flats. So for the calculation of the acceptable lease: rent ceiling according to the rent table + additional charges listed above.


You can find detailed meanings of the five modern amenity requirements, as specified by the Senate Department for Urban Development and Housing lease cap implementation policies, in our list for owners and property owners.


Just how much lease can I charge if I re-let the system?


If the property system is re-let after the law enters into force, the law prohibits taking a higher lease than the lease that has actually been "frozen". If the frozen rent is greater than the suitable upper rent limitation (see lease table), the system might just be let at the statutory rent limitation. If needed, additional charges for contemporary amenities and modernisation procedures can be taken into account in the lease ceiling. In the case of flats whose previous rent was less than EUR 5.02 per square metre, the rent might be increased by an optimum of EUR 1 as much as EUR 5.02 per square metre upon re-letting if modern amenities are readily available. Modern amenities exists if the living area has at least three of the 5 following attributes:


- Passenger lift, available without limits from the flat and from the building entryway
- Fitted kitchen
- High-quality hygienic devices
- High-quality flooring in the bulk of rooms
- Energy intake value of less than 120 kWh/( m TWO a)


When is a rent considered excessive and when can it be decreased?


A lease is considered excessive and is therefore forbidden if it is more than 20% above the appropriate upper rent limitation in the lease table, considering the residential place.


Appropriate surcharges and reductions are also appropriate:


- Flats in a simple house -0.28 euros
- Flats in a medium residential location -0.09 euros
- Flats in a good house +0.74 euros


Are modernisations still possible? To what level can they be allocated to the rent?


Certain modernisation measures and their apportionment to the rent are allowed as much as a maximum of EUR 1.00 per square metre. This limitation likewise uses in case of several modernisations throughout the law's validity period. The requirement is that landlords notify the Investitionsbank Berlin (IBB) of increased rent based on modernisation steps. The IBB is using an online notification procedure. You can send a modernisation alert here.


Please note that when re-letting property space after an apportionable modernisation, the 5 modern-day amenity criteria mentioned above might not be furthermore apportioned (in order to prevent a boost of the limit by up to 2 euros/sq. m).


Which modernisations are permitted?


Apportionable modernisation steps are those to which proprietors are required by law:


- For thermal insulation of the building envelope, basement ceiling, top floor ceiling or roofing system
- For using renewable resources
- For energy-efficient window replacement
- For heater replacement with heating optimisation
- For the addition of a lift
- For the removal of barriers through limit elimination, door widening or restroom conversion


What choices do I have as a residential or commercial property owner if the allowable lease causes losses or to a risk to the building structure in the long term?


In remarkable cases, the IBB can authorize a higher acceptable lease. The requirement is the presence of unnecessary financial difficulty. This is particularly relevant if preserving the acceptable lease would cause irreversible losses for the property owner or endanger the building structure over the long term.


A loss is deemed to exist if existing expenses exceed earnings for the appropriate service entity. A threat to the building structure exists if the earnings from the residential or commercial property is no longer enough for its maintenance.


It must be kept in mind that economic difficulty can only be thought about if the challenge is triggered by the lease cap law. Undue economic hardship is likewise only valid if its event does not lie within the sphere of responsibility of the landlord. In other words, expectations of appreciation in worth, expected returns, increasing funding expenses outside routine market conditions, expected returns based on excessive leas and losses resulting from the division into business entities do not make up a case of challenge.


You can send a difficulty application to the IBB here.


What information obligations do I have as a proprietor?


Landlords should provide occupants with details on the scenarios relevant to the estimation of the rent ceiling within 2 months after the law entering into force and likewise before the conclusion of a new rental agreement, without being asked for to do so. Landlords should inform tenants of the quantity of the crucial date lease on 18 June 2019 upon demand. Prior to the finalizing of a brand-new lease, landlords need to notify future tenants of both without being asked.


You can find details of the info responsibilities under the lease cost cap in our list for residential or commercial property owners and landlords.


How are infractions penalized?


A fine of approximately 500,000 euros might be imposed for infractions of the lease cost cap.


Where can I discover additional info?


At www.engelvoelkers.com/mietendeckelberlin you can find regular updates on the lease rate cap.


Do you have further concerns?


We would be pleased to encourage you! More than 50 realty professionals for the Berlin residential and business residential or commercial property market are readily available to you for additional details at any time personally, by telephone or by e-mail.


Ulrich Blaeser


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Everything about the Berlin lease price cap:


This implies the lease rate cap


Rent cost cap calculator


Obligations for landlords


Disclaimer: This post is intended exclusively as general, non-binding info and must not change detailed research study or expert suggestions. Although this short article has actually been prepared with the best possible care, there is no claim to factual accuracy, efficiency and/or topicality. The specific scenarios of the private case should always be considered. Making use of details consisted of in this article is the sole responsibility of the particular reader. Any liability on the part of Engel & Völkers Gewerbe Berlin GmbH & Co. KG and/or another Engel & Völkers licensee is omitted.


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