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ENERGY

Is it legal for German landlords to turn down heat this winter?

Fears of winter gas shortages have prompted some German landlords to restrict temperatures and access to hot water in their properties. Is there anything tenants can do about it?

Housing estate Berlin winter
Frost lies on the ground near a housing estate in Berlin. Photo: picture alliance / Jörg Carstensen/dpa | Jörg Carstensen

What’s happening?

On Monday, July 11th, the Nord Stream 1 gas pipeline that runs between Russia and Germany was turned off for routine maintenance. For the first time since its been in operation, escalating tensions between the two nations have led to fears that it may not be turned on again.

For weeks, Economics Minister Robert Habeck (Greens) has been calling on households to reduce their energy usage: taking shorter showers, turning off lights and electrical equipment, and minimising the use of hot water. 

So far this has largely been left up to individual choice. However, there are some cases of landlords and housing co-ops making the decision on tenants’ behalf.

Most recently, Germany’s largest landlord Vonovia announced that its tenants would only be able to heat their flats up to 17C in the nighttime – a move that it says will save around eight percent in energy costs. 

A housing co-op in Saxony has taken more drastic steps by turning off the heating entirely until September and putting time slots in place when tenants are able to take hot showers.

In exceptional times, tenants may feel like they aren’t able to complain about these restrictions. But according to German tenancy law, there are things they can do.

READ ALSO: German housing co-op slammed for restricting access to tenants’ hot water

Are rent reductions possible?

Long before the energy crisis, renters and landlords have argued over issues like access to hot water and heating in properties. This means there’s a solid legal precedent to refer to, which clearly stipulates that hot water can’t simply be turned off at certain times.

Monika Schmid-Balzert, a lawyer at the Bavarian regional association of the German Tenants’ Association, recommends that tenants first contact their landlord or letting agent if they notice any issues with the heating or hot water.

According to the German Tenants’ Association, rent reductions are possible for any “defects” that exist in a rented property. These can start automatically from the date of the defect, without the tenant needing to provide notice or set a deadline for the landlord to fix the issue.

For example, if hot water isn’t turned on at night, tenants should be eligible for an eight percent reduction in their rent for as long as the hot water supply is restricted.

If the landlord still doesn’t take action, tenants can consider taking legal action to force them to turn on the hot water or the heating once again. 

READ ALSO: EXPLAINED: How to get a rent reduction for problems in your German flat

What does the law say about temperatures in rental flats?

This is where things get a little bit trickier, as different courts have decided different things over the years.

However, the general consensus is that temperatures should be set at a minimum of 20-22C during the day and 16-18C at night. 

This makes things slightly unclear in the case of Vonovia, who want to set the maximum temperature to 17C between 11pm and 6am from autumn onwards. 

Speaking to Tagesschau, tenancy law expert Schmid-Balzert claimed that properties should be heated at a minimum of 18C in the nighttime. “Anything lower than that is currently too little at night,” she said. 

Thermostat

A man turns down the heat in his apartment. Photo: picture alliance/dpa | Hauke-Christian Dittrich

But Ulrike Kirchhoff, chairwoman of the homeowners’ association Haus und Grund Bayern, disagreed that 18C was the minimum. 

She said that it was the landlords’ duty to ensure that there was enough hot water and that properties were heated “within the limits set by the legislator and the courts”. Nevertheless, Vonovia’s decision to lower the heat to 17C in the evenings was “justifiable”, she said.

Haus and Grund also point out that no firm decision on minimum temperatures has been reached by the Federal Court of Justice.

READ ALSO: German energy crisis: Call for reduction in minimum temperatures for tenants

What if tenants give their consent on energy savings?

If landlords and tenants are able to come to an agreement on energy-saving measures, landlords should be able to implement these decisions without any fear of reprisals or potential rent reduction claims. But this isn’t always an easy thing to achieve.

Firstly, every affected tenant should agree to the new measures, and they should also do so explicitly (i.e. in writing). The more tenants there are who could be impacted, the harder this becomes. 

Tenancy law experts, meanwhile, recommend that landlords trust their tenants to implement their own energy saving measures for the time being. That could include rearranging furniture to improve heat circulation or getting a water-saving shower head. 

If the situation continues to worsen, it’s possible that the government will implement its own restrictions on energy usage such as lower minimum temperatures in flats or limits on hot water usage. In this case, landlords would have to implement the law.

For now, however, they can only act as far as the current law allows them to. 

For example, the Association of Bavarian Housing Companies recommend that its members “align the buildings as closely as possible to the legally required minimum temperature”. This is at least 20C in living rooms, bathrooms and toilets between 6am and 11pm.

In cases like this, tenants may notice a slight difference in the temperature of the flat, but the law will ultimately be on the side of the landlord. 

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PROPERTY

Ask an expert: Is now a good time to buy property in Germany?

An experienced German mortgage broker has told The Local's Germany in Focus podcast that anyone buying now will have to contend with a trade-off between higher interest rates and slightly lower prices.

Ask an expert: Is now a good time to buy property in Germany?

Even with interest rates rising on the back of higher inflation, Peter Kleinwächter, a mortgage broker and financial consultant with MLP Berlin, says people looking to buy in Germany right now might have an interesting window of opportunity – depending on their situation.

“Buyers are in a good position right now, especially if they’re buying from developers,” he said during an interview with The Local’s Germany in Focus podcast, released on Friday February 3rd. Kleinwächter says his business is down to about half of what it is normally. Higher interest rates have scared off many buyers, many of whom simply can’t afford a mortgage right now – even if they have the necessary deposit.

That’s pushing prices down for those buyers still left on the market and giving them a bit more leverage in negotiations. However, Kleinwächter says the window of opportunity won’t always be around for people who want to take advantage of it. He expects house prices to go back up in the medium term.

Escaping the rental market

Another reason that buyers may been keen to get on the housing ladder in Germany is escaping the private rental market, where rents have been spiralling. 

“We have the highest increase in rents that we’ve seen since the 1970s,” Kleinwächter says.

“The pressure on the market is still quite high, especially in the big cities,” he explains, pointing out how housebuilding targets are getting missed around the country, meaning there isn’t enough supply to meet housing demand. He also says he doesn’t anticipate housebuilding targets to be met anything soon and admission also made by the government in recent weeks. That’ll keep prices high even if interest rates eventually go down.

Numbers from builders bear this out too, with around 74 percent of all German construction companies experiencing delays and a full third having cancelled projects due to rising prices for materials. Hanover’s Pestel Institute reckons the country has a shortage of around 700,000 homes.

READ ALSO: German government set to miss target for new homes this year

Kleinwächter says anyone looking to buy now could be able to take advantage of higher interest rates later, if they’re comfortable with some risk.

“Bite the bullet and accept higher interest rates,” he says. “Collect as much of a deposit as you can.”

He also points out the rates for 10-year, 15-year, or 20-year mortgages are fairly similar right now. A buyer comfortable with some risk can lock in current interest rates for 10 or even five years, and then refinance when interest rates go down – as many experts expect them to.

“High interest rates are poison for the economy,” says Kleinwächter, pointing out the European Central Bank will want to lower them again once inflation gets more under control.

READ ALSO: What experts say will happen to the German housing market in 2023

As The Local has been reporting, house prices have recently fallen by as much as ten percent in Germany, depending on the area.

According to the latest survey from property portal ImmoScout24, even major cities like Munich, Frankfurt, and Berlin – which have seen a 63 percent increase in price over the last five years – haven’t escaped the price drop. That said, the price decline is much less pronounced in some places than in others. Düsseldorf saw the biggest fall at a decrease of around 10 percent. Frankfurt saw the smallest, at 2.8 percent.

The price of existing properties in the major German cities.

The price of existing properties in the major German cities. Source: ImmoScout24

Overall, existing flats slipped 4.3 percent in price in the last quarter of 2022 to €2,714 per square metre, while new-build flats were down 6.4 percent to €3,901 per square metre . Meanwhile, existing single family homes fell 4.5 percent and new-build houses 2.7 percent.

Big differences still exist between cities. According to market reports at the end of 2022, buyers in Munich are on the high end, and can expect to shell out €7,425 per square metre. Frankfurters, on average, have to pay considerably less, at €5,578 per square metre. Berliners were paying around €4,569 per square metre at the end of last year and people in Cologne €4,389 per square metre.

Despite the slip in the final quarter of the year, however, house and flat prices in Germany generally remained higher than they were at the end of 2021. 

READ ALSO: REVEALED: How property prices in Germany are sinking dramatically

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