📊 Index-linked rent, graduated rent and modernisation
In brief
Besides the comparable rent there are three ways:
- Index-linked rent: The rent follows the consumer price index. This must be agreed in writing. The rent must stay unchanged for at least one year.
- Graduated rent: Fixed increases on fixed dates, each in euros. Each step applies for at least one year.
- Modernisation: You may pass on 8 percent of the costs per year. Cap: 3 euros per square metre in six years.
You announce modernisations in text form at least three months before they begin.
Step by step
- Check the agreementIs the index or graduation in the contract in writing?
- Announce the modernisationAnnounce it in text form at the latest three months beforehand.
- Separate the costsDeduct the maintenance share.
- Calculate the limitsCheck the cap over six years and hardship cases.
Deadlines
- With index-linked rent, the changed rent applies from the start of the second month after receipt of the declaration.
- With graduated rent, increases under §§ 558 to 559b are excluded (§ 557a Abs. 2 BGB).
- For replacing a heating system, the special rule of § 559e BGB applies instead of § 559: increase of 10 percent of the costs minus third-party funding for measures under § 555b Nr. 1a, at most 0.50 euros per square metre of living space in six years; flat maintenance deduction of 15 percent.
- Mietrecht II provides for changes to index-linked rent and modernisation; government draft, not current law.
- With index-linked rent, besides § 558 also § 559 is excluded, to the extent you are responsible for the measures (§ 557b Abs. 2 BGB).
In depth · legal basis, figures and practice – for advisers and professionals
Index-linked rent, § 557b BGB
The parties can agree in writing that the rent is determined by the consumer price index for all private households in Germany calculated by the Federal Statistical Office. Apart from certain increases, the rent must stay unchanged for at least one year at a time. The change must be declared in text form, stating the index change that has occurred and the new rent amount; it takes effect at the start of the month after next following receipt. Increases under § 558 are excluded; increases under § 559 as well, to the extent the landlord is responsible for the measures (Abs. 2).
Graduated rent, § 557a BGB
The rent can be agreed in writing at different amounts for specific periods; each step stays unchanged for at least one year. A waiver of termination by the tenant is permitted for no more than four years from conclusion of the contract. §§ 556d to 556g apply to each step separately. Increases under §§ 558 to 559b are excluded (Abs. 2).
Modernisation, §§ 555c, 559 BGB
You can increase the annual rent by 8 percent of the costs spent on the flat. Within six years the increase may not exceed 3 euros per square metre of living space; for a rent below 7 euros per square metre, 2 euros. Maintenance costs must be deducted. In the case of unreasonable hardship the increase does not apply, unless the flat was merely brought to a generally customary standard.
Heating replacement, § 559e BGB
For measures under § 555b Nr. 1a (heating replacement), § 559e applies instead of § 559: the annual rent can be increased by 10 percent of the costs spent minus third-party funding, by no more than 0.50 euros per square metre of living space within six years. A flat maintenance deduction of 15 percent must be applied.
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