Are landlords in Germany using furnished lets to evade rent control laws?

Many cities in Germany with a shortage of available living space have rent control laws in place to protect tenants. However, a new study has suggested that landlords are increasingly circumventing these rules by offering furnished apartments with short, fixed-term rental contracts. 

Are short-term rentals exacerbating Germany’s housing crisis?

For many people, short-stay rentals are a useful tool in the tense housing market: if you’re posted to work in Germany for just a short period, having the option to avoid the house hunt and find a fully furnished apartment in advance of your arrival is a tempting option - so tempting that people (or their employers) are often willing to pay top dollar for it. 

But according to a new study by NDR, as reported on by ARD, the lucrativeness of these short-stay furnished rentals is having an impact on the housing market, with a growing number of landlords choosing to offer short-stay accommodation rather than long-term lets, for an inflated price. 

Rent control has been in force in many of Germany’s largest cities, including Hamburg, Berlin, Stuttgart and Munich, for many years. This stipulates that “cold” rents (excluding utilities) cannot be more than 10 percent higher than the local comparative rent. This applies to furnished apartments, but an exception is made to houses and apartments rented short-term or for “temporary use”. 

It is this type of housing that has boomed in recent years. According to a long-term study by the real estate research institute F + B, the proportion of furnished living space on the German rental market has more than doubled over the last decade, from 8,3 percent in 2014 to 18,3 percent in 2021. In some places, the proportion is even higher: 56 percent of the rental housing stock in Stuttgart, for instance, is furnished. 

Tenants’ associations accuse landlords of circumventing rent control laws

Even though furnished apartments are subject to rent control laws, it’s not always easy for tenants to work out whether they’re being charged a fair price. This is because landlords generally add a “furnishing surcharge” to the rent for furnished apartments. However, they do not have to disclose how much this surcharge is in relation to the rent, making it hard for tenants to work out what they’re paying for what and raise a dispute if they believe they are being overcharged. 

According to Rebekka Auf’m Kampe from the Hamburg tenants’ association “Tenants Help Tenants”, landlords are consistently using this to undermine rent caps. “Of course, landlords benefit significantly from this lack of transparency, from these inclusive rents, because the asking price is no longer comparable,” she said. 

The Hamburg Senator for Urban Development and Housing, Dorothee Stapelfeldt, is campaigning to close this loophole, by forcing landlords to itemise their costs and show tenants how much is being paid, for example, in cold rent and for the furnishing surcharge. She is further suggesting that short-term rentals should only be exempt from rent caps for up to six months. 

Rent policy is the federal government’s responsibility

However, since control over rent policy rests with the federal government, there is little that individual federal states can do to take charge of the situation - something proven by the failure of Berlin’s rent cap in front of the Federal Constitutional Court. 

In response to a request from ARD, the Federal Ministry of Building said, “A stronger regulation of rents limited to the market for furnished accommodation is not planned in the coalition agreement for this legislative period.” Instead, the government wants to examine the situation to determine whether there is a problem at all. A law to end the exception made for short-term lets in rent control laws, therefore, seems a long way off.