As a landlord in Germany, you must comply with legal requirements when setting the rent. The applicable limits depend in particular on whether it is a new lease or a rent increase for an existing tenant and whether the rent cap applies. The decisive factor here is the local comparative rent. If you determine this accurately, classify it correctly (location/amenities), and document the derivation, you reduce legal risks and create planning security.
Note: This article does not replace legal advice. If you are unsure (e.g., exceptions, modernization, formal requirements), we recommend consulting with specialist lawyers or expert advisors.
Legal rent caps: 10%, 20%, and the criminal law limit
In practice, the permissible upper limits for rent (especially net cold rent) are based on the local comparative rent, depending on whether the rent cap applies. In addition, there is a threshold above which the issue of rent gouging may come into consideration (e.g., in the context of Section 5 WiStG and Section 291 StGB).
| Region type | Maximum permitted surcharge (guideline) |
|---|---|
NEW RENTAL Without rent control | No legal upper limit 1 |
With rent control | Maximum 10% above comparable rent |
RENT INCREASE EXISTING | Standard: Max. 20% within 3 years Tight market: Max. 15% within 3 years REGULATORY Rent increase of approx. 20% or more 2 CRIMINAL LAW Rent gouging (Section 291 of the German Criminal Code (StGB)) Approx. 50% above the local comparative rent 3 |
1 However, the general limits set out in Section 5 WiStG (rent increase) and Section 291 StGB (rental profiteering) apply.
2 Additionally required: exploitation of a low supply of comparable living space.
3 Additionally required: exploitation of a predicament, inexperience, or weakness of will.
Important: The specific legal assessment depends on the individual case (e.g., exceptions, modernization, previous rent, obligations to provide evidence). Use these values as a structured guide and have special cases reviewed.
Does the rent cap apply to my property?
The rent cap (§ 556d BGB) does not apply nationwide, but only in regionally limited areas with a proven housing shortage. Landlords should therefore first clarify whether the location of their property is designated as a "tight housing market" in a state regulation.
How to check applicability
- Municipality-specific regulations: Each federal state defines the municipalities affected by statutory order (e.g., via state ministries or municipal websites).
- Status in metropolitan areas: In metropolitan areas such as Hamburg, Berlin, and Munich, corresponding regulations often apply.
- Official guidance: The Federal Institute for Research on Building, Urban Affairs, and Spatial Development (BBSR) can serve as a starting point for overviews.
Recommendation: Check the status quarterly, as regulations may be amended. Document the date, source, and result of your check.
Typical exceptions
In practice, the rent cap often does not apply to:
- New buildings (new buildings that were first used and rented after October 1, 2014 (§ 556f BGB).
- Comprehensively modernized apartments (including in the context of Section 556f BGB).
- Existing contracts that were concluded before the respective regional regulation came into force.
Comprehensive modernization is deemed to have taken place if the investment is of a quality similar to that of a new building. Since the distinction between "comprehensively modernized" and the provision of evidence can be complex, it is advisable to seek expert advice in case of uncertainty.
