Landlords who retrofit their buildings may pass part of the cost onto the rent permanently – but only for genuine modernisation and within hard limits.
"If the landlord has carried out modernisation measures within the meaning of § 555b nos. 1, 3, 4, 5 or 6, he may increase the annual rent by 8 percent of the costs expended on the dwelling."
— § 559 (1) BGB (translated)
Modernisation vs. upkeep
Only value-adding or energy-saving works count: insulation, new windows, heating replacement, elevator installation, accessibility. The upkeep share – what was due anyway (that 30-year-old boiler!) – must be deducted; courts routinely accept lump deductions of a third or more.
The caps of § 559 (3a) BGB
- At most €3/m² increase within six years.
- Only €2/m² where the rent was below €7/m² beforehand.
Procedure
Announcement three months ahead in text form (§ 555c BGB), an increase declaration with a traceable cost breakdown (§ 559b BGB), effect from the third month after receipt. The tenant's hardship objection remains available (§ 559 (4) BGB). Run your figures through our levy calculator before declaring.