Rent control: Rip off with furnished apartments?

Rent control applies in cities with a shortage of living space. However, more and more furnished apartments are being offered for a limited period – at very high prices. A tactic used by landlords to overturn the rules?

38 square meters for 1250 euros in Hamburg – offered on the real estate portal “City Wohnen”. You pay 3,000 euros all-inclusive rent in Berlin for a three-room apartment at “Wunderflats”. On such online real estate portals there are countless offers with particularly high rental prices. They all have one thing in common: the advertisements show furnished apartments for a limited time.

A lot of money for little space

Rent control has been in force in many large cities with tight housing markets, such as Hamburg, Berlin, Stuttgart and Munich, for several years. The net cold rent may not be determined arbitrarily. It may be a maximum of ten percent above the local comparative rent. This rental price brake also applies to furnished living space.

However, there are exceptions to the rental price brake. This includes new buildings from 2014. Short-term rentals or “renting for temporary use” are also excluded from this. Furnished living space has experienced a veritable boom on the German housing market in recent years.

According to a long-term study by the real estate research institute F + B, the proportion of furnished living space has more than doubled in recent years from 8.3 percent (2014) to 18.3 percent (2021). The proportion is even higher in the eight largest cities: In Stuttgart, for example, 56 percent of the offers on real estate portals now relate to furnished apartments, according to the study.

Rental price brake also applies to furniture

If the landlord rents “furnished”, he may also request a furnishing surcharge on top of the rental price. Furnished apartments are often offered at flat rates. The net cold rent, the operating costs and the furnishing surcharge are included but not itemized individually. For the potential tenant, this means that he can usually not understand whether the net cold rent corresponds to the rent control and how expensive the furniture is.

“For furnished apartments, the rental price brake applies quite normally, if necessary, landlords can take a furnishing surcharge for the furniture,” says Rebekka Auf’m Kampe from the Hamburg tenants’ association “Tenants Help Tenants”. In the past, your association has successfully reduced rental prices for furnished living space that are too high – up to several hundred euros a month.

Landlord does not have to show surcharge

There are models such as the Hamburg and Berlin models that can be used to calculate the furniture. However, the landlord does not have to show how high the furnishing surcharge is before the contract is concluded. The accusation raised by tenants’ associations is that the rental price brake is being consistently undermined here. “Of course, landlords benefit significantly from this lack of transparency, from these inclusive rents, because the asking price is no longer comparable,” says Rebekka Auf’m Kampe.

There is no right to information about how the rent is made up before the contract is concluded. After the conclusion of a rental agreement, tenants have the right to information under the German Civil Code – and only if there is a suspicion of a violation of the rental brake. However, that is only small consolation, according to Auf’m Kampe. “As a rule, tenants want to know whether a complaint about the rental price brake would be promising before they enter into a dispute with the landlord.” Tenant associations such as “Tenants help tenants” in Hamburg therefore recommend seeking advice before obtaining any information on suspicion. Otherwise, the tenancy may be permanently burdened.

At the same time, more and more apartments in metropolitan areas are being withdrawn from the already tense rental market thanks to furnished short-term rentals. At best, they served as a cheaper alternative to hotels.

Rent policy is federal policy

Hamburg’s Senator for Urban Development and Housing, SPD politician Dorothee Stapelfeldt, is campaigning to protect tenants from excessive asking rents for furnished living space and short-term rentals. She proposes that landlords always have to show the respective furnishing surcharge and that short-term rentals are only exempt from the rental price brake for up to six months. In doing so, she wants to close the loopholes of the rental price brake.

But municipalities like Hamburg or Berlin can do little on their own, because rent policy is federal policy. Since the federal government already regulates housing policy to a large extent, the states alone no longer have regulatory competence, as the judgment of the Federal Constitutional Court in the decision on the Berlin rent cap last year confirmed again.

law far away

In August, the Hamburg Senate therefore introduced a legislative initiative to the Bundesrat. Federal states such as Bremen and Baden-Württemberg joined the initiative. But Hamburg took the draft law off the agenda a short time later, in November, so that the initiative could not even be negotiated in the Bundesrat. The Hamburg building senator entered the coalition negotiations after the federal elections with her proposal. But there is no mention of Stapelfeldt’s proposal in the traffic light coalition agreement.

On request, the Federal Ministry of Building informed that “a stronger regulation of rents limited to the market for furnished accommodation is not planned in the coalition agreement for this legislative period”. Instead, a research project on the subject is being worked on by the FDP-led Federal Ministry of Justice “in order to have a data basis for the furnished accommodation market that can be used to assess whether there is a need for regulation”.

The federal government therefore wants to continue to examine whether there is a problem here at all. A timely law that could close the legal gaps in the rental price brake for furnished apartments and short-term rentals seems a long way off. For potential tenants, this also means that they are moving in a non-transparent, often overpriced housing market in which it is not clear to them whether a rent is reasonable or not.