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HOUSING

Berlin to offer loans and grants to hard-up tenants after rent cap defeat

The Berlin government says it will set aside millions of euros in aid and loans to help tenants struggling after the Mietendeckel was overturned.

Berlin to offer loans and grants to hard-up tenants after rent cap defeat
People demonstrating against the Mietendeckel defeat in Berlin. Photo: DPA

Tens of thousands of Berliners affected have been hit with hikes to their rent after the rental cap was ruled void by the federal constitutional court last week.

Many people are also facing back payments from landlords and private housing companies.

On Tuesday the Berlin Senate announced they would help tenants who had not saved the money to pay landlords back, or were struggling with their new rent increase.

According to the government, 365,000 residents in Berlin were temporarily entitled to a rent reduction until the court ruling last week.

Of these, the Senate estimates that 40,000 households may struggle to pay back the differences in the months they paid the temporary lower rent.

In extreme cases, people could be threatened with eviction, the local government said – and the hardship fund will apply to these households who need it most.

Some Berliners’ rents were lowered when the second stage of the rent cap came into force on November 23rd 2020, while others are tenants who have signed so-called ‘shadow tenancy agreements’ which included two rents in the contract. 

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So what help can people get?

The amount of money that people can get depends on their income.

The local government in a press release said the loans “must be repaid and are granted interest-free. If tenants are unable to repay all or part of the money through no fault of their own, the loan can be converted into a grant and its repayment (partially) waived.”

Tenants who are not on housing benefits and who have not set aside the “saved” rent payments will therefore have the opportunity to receive bridging assistance.

All households whose income is up to 280 percent of the federal income limit are eligible. The annual federal income limit for a one-person household is currently €12,000 per year.

It means that under Berlin’s rent protection fund, single-person households with an income of up to €33,600 per year are eligible.

People who are on benefits should contact their district office to check whether the landlord’s additional demands can be met with housing benefit.

The Berlin Senate plans to commission the Investitionsbank Berlin (IBB) to pay out the loans.

Tenants will be required to submit information to prove their situation, including their lease and proof of rent payment for the last three months.

Funds could be in accounts as early as May 1st.

However, it is a matter of “bridging liquidity, which is only converted into grants in cases of hardship”, said housing senator Sebastian Scheel emphasising that the government prefers to offer loans rather than grants.

The rent cover fund will include €10 million to help tenants.

Some private landlords have announced they will waive repayments for tenants. Berlin state-owned housing companies are also not demanding the money back.

Others, such as Deutsche Wohnen, Berlin’s biggest private housing firm, said they will demand repayments.

Scheel said: “Some landlords have already announced that they will waive repayments or offer deferments. I appeal to all landlords to follow this path. It is self-evident that the state-owned housing societies do not charge back.”

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RENTING

Everything you should know about renting a furnished flat in Germany

Furnished properties are increasingly popular in Germany - but it's worth knowing the rules around them to make sure you don't get overcharged. Here's everything you need to know before signing the contract on a furnished flat.

Everything you should know about renting a furnished flat in Germany

For someone moving to a new country or city, it seems like a dream scenario: you find a new place, pick up the key, and simply move in and unpack. Everything you need, from your bed to your coffee table, is already there waiting for you. 

You can dispense with the endless trawls through IKEA showrooms and trips across town to pick up second-hand furniture on Ebay Kleinanzeigen – not to mention the stress of endless decisions on colour schemes and measurements. 

It’s exactly this that makes furnished flats such a popular choice with foreigners. While they may not be a long-term option, the ease and flexibility of being able to move-in straight away makes them a great short- or medium-term option while you’re finding your feet in a city.

So, what’s the catch? 

A search for furnished flats on any rental property portal will reveal all. 

For around 30 square metres in Hamburg – the size of a large hotel room – it’s not unusual to see prices of around €2,700 or more per month, which amounts to a pretty hefty €90 per square metre. In Berlin, €3,000 per month may well be the price you pay for a tiny studio in a central location: €100 per square metre.

In the banking hub of Frankfurt, things are marginally more affordable. Here, a 30-square-metre furnished flat will set you back around €1,500. But that’s still a pretty steep €50 per square metre. 

Listings like these can give the impression that landlords are allowed to charge whatever they please for a furnished property. Thankfully, that’s not true – though the rules can get a little bit murky, especially when it comes to short-term lets.

READ ALSO: Six confusing things about renting a flat in Germany

Here’s a few other things you need to know. 

What is a furnished flat?

If a flat is rented as a furnished flat, it should have at least the bare essentials that are required to live in it. Generally, that would mean a bed, wardrobe, table, chairs and sofa, etc. 

However, you can occasionally find furnished flats that are “löffelfertig” (spoon-ready), which as the name suggests means they have everything you need, right down to cutlery and crockery. 

Why are furnished flats more expensive?

Generally speaking, landlords are entitled to compensation for the furniture they buy for the property, which can push the monthly rent up by as much as a few hundred euros per month. 

Since they don’t have to be clear about these costs and how different parts of the rent are calculated, some landlords may inflate the base rent as well, meaning that tenants may end up paying way over the odds. 

It’s also worth knowing that if properties are specifically defined as either holiday or short-term lets, landlords are exempt from many of the usual rent controls. 

Furnished holiday flat Germany

A modern furnished flat in Mecklenburg Western-Pomerania. Photo: picture alliance/dpa/Bades Huk | BRITA SOENNICHSEN

If the furnished flat is considered to be a holiday let, then the tenant is often required to pay tourist tax for each night they stay there. In this case, the flat also doesn’t have to be furnished to a particularly high standard as it is only intended to be lived in for a very short time. You may find this type of flat absurdly pricey compared to normal rentals in the city, and if money is a concern it’s best to steer clear of holiday lets for longer-term stays. 

If you work in the city and are staying somewhere for more than two months, the landlord may decide to class the property as a temporary let. In this case, the landlord is exempted from clauses like the Mietpreisbremse (rent brake), which are designed to slow down the rate of rent increases, and you should have a clear duration or move-out date specified in your contract.  

It’s important to note that the landlord will usually have to give a good reason for restricting the time period of the rental. This could be the fact that they or their family want to use it themselves or are planning renovations at a later date. 

READ ALSO: Altbau vs Neubau: What’s the difference and which should I rent in Germany?

How much more can my landlord charge?

As mentioned above, holiday and temporary flats can often be rented out for eye-watering prices – but there are strict rules on categorising a rental flat as temporary or holiday accommodation.

For an ordinary furnished rental, the rent should usually be roughly based on standard prices for similar properties in the same area (a system known as the Mietspiegel), with any premium features or fixtures adding slightly more to the monthly rent. As mentioned above, the landlord can also charge a surplus for the furnishings they include in the flat.

The broad rule of thumb here is that this should be linked to the value of the furniture and its depreciation in value of the course of time. Though landlords aren’t forced to be transparent about the system they use, the two most commonly used ones are the Hamburg and the Berlin model. 

Furnished flat

A cosy bedroom in a furnished flat. Photo: picture alliance/dpa/VDM | Rauch

With the Berlin model, the landlord is allowed to charge two percent of the total value of the furniture each month.

The furniture is assumed to have a lifespan of 10 years, so if the furniture is new when the tenant moves in, they can charge two percent of the purchase price of the furniture each month. If all the furniture in a flat cost the landlord €5,000, that would amount to €100 extra in rent each month. The value of the furniture goes down by ten percent per year, so after five years the landlord would charge €50 per month on top of rent, and after ten there would be no surcharge.

The Hamburg model assumes that furniture goes down in value over the course of seven years, after which time it’s worth just 30 percent of its purchase price. The amount that the tenant pays towards the cost of the furnishings each year is based on these calculations.

READ ALSO: 

Can I take furniture out of a furnished flat?

Yes! If you’re someone who likes to put your own stamp on a place, then you’re fully entitled to replace some of the furniture with your own.

But – and this is a big ‘but’ – you’ll be responsible for storing the furniture safely until you move out, and putting everything back in its previous place.

In other words, we don’t recommend chucking the coffee table out on the street with a ‘Zu verschenken’ label before moving in your own piece. We guarantee your landlord will not be amused once they find out. 

To clarify what’s meant to be in the flat when you move in (and when you move out), tenancy law experts recommend having a full inventory in the contract. That should help you avoid any nasty disputes in the future.

What if the furniture is damaged, missing or defective? 

If furniture is damaged, missing or unusable, you’re entitled to have it repaired or replaced and can also ask for a rent reduction.

Once again, it’s useful to have a full inventory of what should be in the flat to help you with these negotiations.

Do tenants in furnished flats have the same rights as other tenants?

Generally, yes. Having furnishings inside a property doesn’t change the legal status of the contract.

That means that your landlord can’t, for example, suddenly ask you to move out at short notice and without any cause. As mentioned, they also need to have a specific reason for limiting the duration of your contract – otherwise the move-out date isn’t valid. 

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