Discovering Germany

Minimum Specified Duration The contract is valid for an unlimited period of time, however, with a minimum rental period e.g. one or two years. In this case this kind of contract cannot be terminated within the minimum rental period. This applies to both parties, the landlord, and the tenant. Specified Duration This kind of contract cannot be terminated easily. This applies to both sides, the landlord and the tenant. The tenant can only cancel the lease by giving the landlord an important reason, i.e. he has to move to another city on professional grounds (diplomatic clause). This needs to be specified in the contract.

Diplomatic Clause: In case the tenant has to move due to professional reasons, he can cancel the lease with three months prior notice at any time.

Helpful Hint: It is recommended that expatriates try to conclude rental agreements for an unspecified duration. When signing the contract, the landlord may ask to see a salary declaration or a copy of the tenant’s work contract.

Additional Costs and Expectations Once the contract is signed by both parties, the following payments need to be made: estate agent’s commission, security deposit, and monthly rent. The details are outlined below. Estate Agent’s Commission ( Maklercourtage ) According to a law change, this fee is legally limited to a maximum of two months’ net rent plus German VAT ( Kaltmiete ) . Additional costs for utilities and heating, for example, are not included in this calculation. At times, the landlord pays this, however there are occasions when the tenant still pays this fee. This is normally clarified on an individual basis before signing the lease. Security Deposit ( Kaution ) The deposit is legally limited to a maximum of three months’ net rent ( Kaltmiete ) and does not include any additional costs. The most common form of security deposit payment is put into a savings account. The deposit, including interest, is returned after the end of the lease if no claims have been lodged against the tenant. The landlord should return the security deposit within six months after lease termination. Monthly Rent ( Monatsmiete ) The monthly rent is usually paid in advance, typically by the third day of each month. Most landlords insist on standing orders ( Daueraufträge ) as the form of payment.

Maintaining a Rental Property Maintenance Costs and Utilities ( Nebenkosten )

The landlord is legally allowed to pass on costs to the tenant, e.g. garbage removal, chimney sweep, insurance for the property. These costs are mentioned in the rental contract. In general, the tenant pays a pre-payment every month with the rent. The total payment will be adjusted at the end of the year according to the tenant’s usage, unless otherwise agreed. The tenant will either have to pay the difference or he will be reimbursed for overpayment.

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Discovering Germany