The Limited Times

Now you can see non-English news...

Inflation: Tenants' association complains about sharp increase in index rents

2023-01-20T06:17:06.172Z


More and more property owners apparently want to take advantage of the high inflation. The tenants' association is now demanding a ban on index rents that are based on price increases. But Minister of Justice Buschmann stands in the way.


Enlarge image

Residential buildings in the city center of Erfurt

Photo: Martin Schutt / picture alliance/dpa/dpa-Zentralbild

According to the German Tenants' Association, an increasing number of new leases are linked to inflation.

In larger metropolises, so-called index rents were agreed in an average of 30 percent of new contracts last year, the tenants' association reported.

Far more than in previous years.

In making this estimate, he relies on data from the tenants' associations in Berlin, Hamburg, Hanover, Cologne, Frankfurt and Düsseldorf, which together carried out around 232,000 consultations a year.

For Berlin, the tenants' association assumes that up to 70 percent of the new rental contracts provide for indexation, i.e. significantly more than the average for the relevant cities.

"Tenants are increasingly coming to our advice centers with questions about index rents, and the proportion of advice on this has more than doubled within a year," said Tenants' Association President Lukas Siebenkotten.

In terms of social and housing policy, it is irresponsible that recently every third newly concluded rental contract was linked to inflation.

Federal Minister of Justice Marco Buschmann (FDP) must ban index rents, he demanded.

Justice Minister Buschmann had rejected demands from the SPD for a reform of index rents in December.

In recent years, tenants with such contracts have been in a better position than tenants with other contracts, he told the Rheinische Post.

Because the cost of living has risen more slowly in the past than the comparable rents, on which rent increases are usually based.

"Many landlords are taking full advantage of the options for inflation adjustments in existing rental contracts and have increased their tenants' rent by up to 15 percent in the crisis year 2022 alone," said Siebenkotten.

The enormously increased costs for heating and electricity would be added to this.

Index rents have “become an unreasonable cost trap with high inflation and rising energy prices and must also be more limited in the portfolio.”

According to the tenants' association, the trend towards index rents has increased significantly.

In 2021, around ten to 15 percent of the consulting cases were about index rents, in 2020 this proportion was marginal.

Inflation, which is relevant for index rents, reached its highest level since the founding of the Federal Republic last year.

Consumer prices rose by 7.9 percent on average over the year.

kig/dpa-AFX

Source: spiegel

All business articles on 2023-01-20

You may like

Trends 24h

Latest

© Communities 2019 - Privacy

The information on this site is from external sources that are not under our control.
The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.