The implementation of a modernization is always associated with an investment and the associated financial expense. Apartment owners are allowed to share the costs with the resident tenants through an allocation. However, the type and scope of the rent increase are precisely regulated.
In the case of modernization, tenants often fear that the rent will rise sharply as a result of the renovation and become an excessive financial burden. The legislature wants to protect the apartment users from this “modernization” through its regulations. In addition, the landlord’s conversions can also lead to financial relief, for example by lowering the tenant’s warm operating costs by increasing energy efficiency.
The difference between modernization and conservation measures
In order for a landlord to be entitled to a modernization-related rent increase, there must actually be a modernization. Typical modernization measures, such as energetic renovations and sustainable increases in utility value, are defined in Section 555b of the German Civil Code. Maintenance work and repairs are to be distinguished from this. The landlord has to assume this in full, as they only serve to maintain the apartment. In practice, there is often an overlap. However, only modernization costs may be passed on to the rent.
The modernization levy
In the course of a modernization, the landlord can add eight percent of the costs to the annual rent. In advance, the tenant must be informed in writing of the modernization measure at least three months before the start of the renovation. The apartment user must be informed of the beginning and end of the renovation as well as the expected amount of the rent increase. If the quality of the living space is adversely affected by disruptions during construction work, the tenants may request a temporary reduction in rent.
The limits of rent increases
There are several restrictions on rent increases. In advance, a tenant has the opportunity to object to the measure within one month of the announcement of the modernization. In this way, a household can defend itself against a renovation if it should be particularly restricted or burdened by it. Secondly, the legislature protects the apartment user from an excessive rent increase. According to § 559 Para. 3a BGB, the monthly rent may increase by a maximum of three euros per square meter within six years after a modernization. In the case of rental prices below seven euros per square meter, an increase of only two euros per square meter is allowed.
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