;Resize=(1200,627)&impolicy=perceptual&quality=medium&hash=316e0c674baddba7d9324cfb12727beea4b97e93063ecb51d1e7cdbbab2473d8 "Tenants’ association even calls for a ban – index rent can become a cost trap for millions of Germans")
Tenants’ association even calls for a ban: Index rent can become a cost trap for millions of Germans
Due to the high inflation, more and more landlords are demanding a so-called index rent, which is based on the price increase. But for many tenants, this could become a real cost trap in the long run.
On average, tenants in Germany spend around 20 percent of their household income on rent – but in large cities the figure is usually much higher. In many places you even have to plan for a third of the salary or more to get a halfway decent apartment.
There is currently a frightening trend that could exacerbate the situation again: As the tenants’ association reports, there have been more and more new ones recently
Lease agreements with an index rent
.
That is why the index rent is problematic for tenants
The tenants’ association has around in the cities of Berlin, Hamburg, Hanover, Cologne, Frankfurt and Düsseldorf
232,000 consultations in 2022
carried out. Based on this data, an average of 30 percent of new contracts were agreed with an index rent – in Berlin it should even be up to 70 percent.
The President of the Tenants’ Association, Lukas Siebenkotten, considers this development to be socio-politically irresponsible in view of the high inflation of almost eight percent. He calls on Federal Justice Minister Marco Buschmann (FDP) to ban index rents.
However, he rejected this in December after demands from the SPD, since tenants with index rents have often been cheaper in recent years than others whose rents have risen based on comparable rents.
You must pay attention to this in the rental agreement
You will not necessarily find the term “indexed rent” in the rental agreement. Often there are specific clauses that you need to pay attention to. Example:
“If the consumer price index for Germany determined by the Federal Statistical Office (base year 2021: 106.3 points) changes by at least X percent compared to the first month of the tenancy or compared to the month of the last rent adjustment, the rent changes by the same percentage.”
According to a judgment by the Federal Court of Justice, however, the base year does not necessarily have to be recorded in it. The consumer price index is based on a new base year every five years anyway.
It is important that the rent may not be increased several times a year, but only
after 12 months without adjustment
. Corresponding clauses would therefore be ineffective.
How much do the costs increase with index rent?
If you want to calculate for yourself how much the rent would rise, you can use a simple formula. This reads as follows:
- New Index / Old Index × 100 – 100 = Percent Index Increase
The landlord can then apply this percentage to the cold rent if the rent has not been increased in the last twelve months. In numbers, using the consumer price index for January 2021 and January 2022:
- 111.5 : 106.3 × 100 -100 = 4.89 percent
If the basic rent is 750 euros, then the basic rent increases by 36.67 euros per month and thus
440.04 euros per year
. You would then pay more than half the cold rent extra.
How much you earn compared to other Germans
These three principles about money are wrong!
pH/CHIP
