Status: 01/20/2023 11:20 a.m
Contracts with landlords increasingly provide that rents can be increased annually in line with the general rate of inflation. The German Tenants’ Association criticizes that this is not socially responsible.
In Germany, newly concluded leases are increasingly linked to inflation. In larger metropolises, index rents were agreed on average for 30 percent of new contracts last year, reports the German Tenants’ Association (DMB). For Berlin, the tenants’ association assumes that even up to 70 percent of the new leases provide for indexation.
The DMB bases this estimate on advice from the tenants’ associations in Berlin, Hamburg, Hanover, Cologne, Frankfurt and Düsseldorf. “Tenants are increasingly coming to our advice centers with questions about index rents, and the proportion of advice on this has more than doubled within a year,” said Tenants’ Association President Lukas Siebenkotten.
What is an index lease?
With an index rental agreement, the landlord can increase the basic rent if prices rise overall. The consumer price index of the Federal Statistical Office serves as the sole reference value. However, the rent does not increase automatically, but only if the landlord makes use of the index clause. Once a year he is allowed to raise the cold rent to the extent of the general inflation rate. There is no upper limit.
In 2021, around 10 to 15 percent of the consulting cases were about index rents, in 2020 this proportion was marginal. It is not responsible for social and housing policy that the number of index rental contracts has increased so much.
“Many landlords take full advantage of the opportunities”
Federal Minister of Justice Marco Buschmann must ban index rents, demanded Siebenkotten. “Many landlords are taking full advantage of the options for inflation adjustments in existing rental contracts and have increased their tenants’ rent by up to 15 percent in the crisis year of 2022 alone,” said Siebenkotten. “The enormously increased costs for heating and electricity are added to this.”
Buschmann had rejected calls for a reform of index rents in December. In recent years, tenants with such contracts would have been better off than tenants with other contracts. In the past, the inflation rate was lower than the increase in comparable rents, which are used as a basis for rents in other contracts.
However, this trend has changed: According to the Federal Statistical Office, the inflation rate in Germany is currently 8.6 percent. On average for 2022, consumer prices increased by 7.9 percent.