Although it is applicable law, it is surprising how many people are unaware that the basic rent (rent excluding utilities) for most apartments in major German cities is limited by law. In many cases, tenants can reclaim any excess money they have paid and only have to pay the lower rent in future.
One reason for the lack of awareness that the basic rent in German cities is regularly limited by law may be the complexity of the legal regulations. For example, the maximum rent for an apartment must be calculated individually; it is not specified as such in the law. Some people also confuse the applicable regulations of the so-called rent cap with those of the Berlin rent cap, which was overturned by the Federal Constitutional Court in April 2021. The rent cap froze rents for five years from a certain date. In contrast, under the rent control regulations, which continue to apply, rent increases are possible both for new leases and during the course of the tenancy, but only within certain limits. These limits are regularly disregarded by landlords. Tenants often pay many hundreds of euros too much in rent each month.
This is because the basic rent for a new lease may not exceed the so-called “local comparative rent” by more than 10%. If the rent is excessively high, the tenant can reclaim any excess rent paid in writing for up to 30 months from the date of conclusion of the lease, provided that the lease was concluded after April 1, 2020. The landlord is then obliged to reduce the rent and, if necessary, repay any excess money to the tenant. This also applies to the portion of the deposit that exceeds three times the maximum permissible base rent. If the lease was signed more than 30 months ago, the tenant can only demand a reduction in rent for the future.
The probability that the base rent for an apartment in Berlin is too high is extremely high. This is particularly true for new rentals. For example, the Berlin Senate Administration's rent review office found that 93 of the 95 rental agreements it reviewed had an impermissibly high base rent – a violation rate of over 97% of cases. In 61 cases, there was also suspicion of rent gouging, i.e., the rent was at least 50% above the local comparative rent.
A study by the Berlin Tenants' Association (BMV) from 2023 on legal cases within the scope of the rent cap (new rentals) also came to the conclusion that there are significant violations of the rent cap regulation. The tenants' association found that rents for new leases are often 30% higher than rents in existing tenancies and that landlords often disregard the rent control law. The study was based on an examination of almost 1,000 cases in 2021 and shows that the violations are considerable both in terms of their frequency and the amount by which rents exceed the limits.
The law requires tenants to notify landlords in writing if the rent is too high. Landlords are then obliged to reduce the rent to a legally compliant level and, if necessary, refund any excess money paid by the tenant. Since calculating the maximum rent and drafting a complaint requires legal expertise, it is advisable to hire a professional legal service provider to reduce the rent.
