In Munich, many residents are taking action against a brazen plan to increase rents. The court has now proven them right.
The rents in this residential complex in Schwabing are to be drastically increased Photo: Sina Schuldt/dpa
The nationwide rent brake apparently works after all – at least in the case of the residents of 220 apartments in the Hohenzollernkarree in Munich-Schwabing. In the last days of last year, they were confronted with the announcement of drastic rent increases of up to almost 100 percent, because the ensemble was to be extensively renovated. When the announcement was made, the old rental law applied – just barely – which would have made this possible.
The Munich Higher Administrative Court has now ruled in favor of the tenants and put the brakes on the plan. According to the Munich Tenants’ Association, it is not permissible to "quickly take advantage of old law. After the verdict, its managing director Volker Rastatter says: "It’s worth going to court for fair rents."
In the morning, Sigrid Seidl, Silke Hoppner and other tenants of the complex were still sitting very tense and full of doubts in the courtroom of the Palace of Justice. Seidl, 58, currently pays 677 euros for her 57-square-meter apartment; in the future, it will be 600 euros more. "I’m all fixed up," says the woman in the pink dirndl. She has lived there since 1991, and is currently also looking after her mother in a nursing home.
Hoppner’s rent is 805 euros for 60 square meters. From the landlord, the Max Emanuel real estates GmbH, in the future 1,600 euro had been announced to it. Could the insurance employee afford that? "Nope," she says and laughs bitterly.
In the afternoon, there was great joy when the presiding judge, Nikolaus Stackmann, allowed the so-called Musterfeststellungsklage of the Munich Tenants’ Association. "The planning status does not justify the modernization notice," he says. This means: the real estate company, which delivered the letters to the tenants – by messenger – on December 27 last year, still wanted to take advantage of the old law, although the expensive modernization was not yet concretely prepared. This is the first time in Germany that the court has ruled on such a case.
The appeal is admitted
Until the turn of the year, the legal situation was like this: Landlords could generously pass on modernizations to the rents, up to eleven percent of the costs annually. This incentive was created in the 1970s with the entirely sensible aim of modernizing the housing stock. At that time, many apartments did not have central heating, for example, and some did not even have their own bathroom.
In recent years, however, we have seen many residential neighborhoods in the prime location of Munich having their doors and windows replaced, roller shutters, balconies and new insulation installed, and exterior elevators installed. Those who could then no longer pay the much higher rents had to move out. And finally, the apartments were sold individually at top prices.
Under the new law, however, it is only permitted to add eight instead of eleven percent to the rent. And above all: the amount may not exceed three euros per square meter. So if you have 60 square meters, for example, your rent can only go up by a maximum of 180 euros. The property management of the Max-Emanuel Immobilien GmbH had communicated that the planned increases had "by far not exhausted the legal possibilities".
The judge wants to know from real estate lawyer Wolfgang Sturzer whether the aim is to "modernize out" the tenants. The latter says evasively: "I am not aware of any plans to sell the company.
The appeal has been allowed, so the case is likely to come before the Federal Court of Justice. But it would take several years before a decision is reached, says Rastatter, executive director of the Munich tenants’ association. "Until then, people will have peace."