AXIUM makes rent increases
The property management of the AXIUM group of companies will start in June 2023 - immediately after the new rent index 2023 is available - with the examination of the rents of all customers and implement rent increases. In some cases, rents can be increased by up to 15%.
What is a rent index and what is it used for?
A rent index is a compilation that contains information about the average rents in a specific region. It serves as a guide for landlords and tenants to estimate the local comparative rent. The rent index is based on a regularly updated overview of rents, which is based on legal requirements. It determines how high the maximum permissible net cold rent may be in the event of a rent increase for a specific apartment and is also relevant for new rentals.
The rent index offers tenants the opportunity to check whether the required rent is reasonable or seems too high. He also informs you of the acceptable rent limit or how high the rent can be in the case of a new lease. The rent index enables landlords to find out up to what amount they can increase or agree on the rent. Thus, the rent index serves as a balance of interests between both parties.
In addition, the rent index is also used to determine appropriate upper rent limits for people who receive transfer payments. However, it is important to note that the rent index does not contain any information on rents for subsidized apartments with rent control, new new build apartments or apartments in single and two-family houses. The rents collected in the rent index are made comparable using certain legally defined criteria such as size, equipment and location.
The distinction between simple and qualified rent indexes is that qualified rent indexes meet certain qualitative requirements, while simple rent indexes do not meet these requirements. According to the German Civil Code (Bürgerliches Gesetzbuch - BGB), every rent index is considered as such if it has been drawn up or recognized by the responsible authority or by representatives of the interests of landlords and tenants. However, qualified rent indexes are associated with special legal consequences, since they have to meet certain quality standards in terms of data collection and evaluation.
In contrast, landlords do not have to specify the rent index value when requesting a rent increase based on a simple rent index. A simple rent index does not have the presumption that it “correctly” reflects the local comparative rent. However, a simple rent index can generally serve as an indication that the rental values reflect the market situation, and this is decided by the court on a case-by-case basis. Simple rent indexes can also be used to justify requests for rent increases and contribute to harmonization between landlords and tenants. If, for certain reasons, no qualified rent index can be created, simple rent indexes are a good alternative.
With regard to the 2023 rent index in Berlin, "only" a simple rent index was created for the following reason: It was originally planned to publish a new qualified rent index for 2021 two years after the publication of the previous rent index for 2023, in order to comply with the deadlines in accordance with the German Civil Code. However, the process was stopped by an application for an award review at the end of 2021. The Berlin Court of Appeal ruled in favor of Berlin in October 2022, which made it possible to start compiling the qualified rent index. Due to the time lag, however, a simple rent index was created for 2023 in order to avoid a gap in the rent index. In this case, the data collection and evaluation as well as other requirements for a qualified rent index could not be fulfilled in terms of time. The Senate Department for Urban Development, Building and Housing therefore created the simple rent index in accordance with Section 558c Paragraph 1 of the German Civil Code.
No rental and equipment data could be collected to determine the index in the 2023 rent index. Therefore, the rental values from the 2021 rent index have been further developed with the help of an index in order to reflect the current market situation and the development of the local comparative rent since 2021. The Berlin rent index 2021, which reflects the status as of September 1, 2020, served as the starting point. To determine the market development since then, the development of the price indices between September 2020 and September 2022 was taken into account in accordance with the two-year period in the German Civil Code. The consumer price index (CPI) Germany was used as a basis, but two sub-indices of the Berlin CPI were selected that adequately reflect the rent development and the general development without taking into account the cost drivers such as energy and food. These indices were determined and weighted by the Berlin-Brandenburg Statistical Office in order to adequately take the development of rents into account. The result showed an annual development of 2,7%. All values in the 2021 rent index were multiplied by a factor accordingly in order to adjust them.
When using the rent index 2023, the allocation of residential areas, the noise labeling and the orientation aid for the range classification are unchanged compared to the rent index 2021. New addresses since the last rent index could not be assigned to any residential area and are therefore not included in the street directory. The 2023 rent index still does not apply to apartments that were ready for occupancy after January 1, 2018. It was also not possible to create an overview of operating costs.