Initial Rental Rate for Bremen Properties
Protecting Tenants and Landlords: Bremen's New Rental Price Index
Bremen, the only federal state in Germany without a rental price index until now, has introduced a new qualitative rental index. According to Senator for Urban Development Özel Unsal, this index aims to secure fair rental relations for tenants and a reliable overview of rental prices for landlords.
The inception of the Bremen rental price index is a result of collaboration between BAB - The Promotion Bank for Bremen and Bremerhaven, the German Tenants' Association - Tenant Association Bremen, and Haus & Grund Bremen. Together, they collected data from 10,000 apartments via 4,600 questionnaires sent to tenants and 6,190 to landlords. The data will be adjusted every two years and updated every four years.
The rental price index is based on various factors such as location, year of construction, type, size, condition, and equipment of the apartment. For instance, the basic table asks for the size of the apartment, with an example of an 87 square meter apartment commanding a base rent of 5.87 euros per square meter. Additional considerations such as the year of construction or living area class may result in adjustments to the base rent.
Thomas Trenz, chairman of Haus & Grund, lauds the collaborative approach, explaining that each partner made concessions based on data, not subjective opinions. However, significant jumps in rental prices depending on geography and year of construction have been noted, indicating that the path to results was not predetermined.
For tenants, the rental price index serves as a tool to check the application of the rent brake in new lettings. Kornelia Ahlring, managing director of the German Tenants' Association - Tenant Association Bremen, expresses that while the index does not contribute to the creation of new and affordable housing, it provides a more effective means to check whether the rent brake is being applied.
The rental price index will be effective from January 1, 2024, and can be accessed online at bremer-mietspiegel.de from December 29.
Factors that typically influence rental prices in Germany and Bremen include location and demand, supply and vacancy rates, economic conditions, government policies and regulations, and market trends. While Bremen's rental price index takes these factors into account, the specifics related to the city remain subject to the index's data.
- The new rental price index in Bremen, derived from a collaboration between various entities, aims to provide a reliable overview of rental prices for landlords, while also ensuring fair rental relations for tenants, through the consideration of factors such as location, year of construction, type, size, condition, and equipment of the apartment, as part of their investing in real-estate business.
- For tenants in Bremen, the implementation of the rental price index serves as a useful tool to verify whether the rent brake, a financial regulation, is being properly applied in new lettings, offering a more effective means of ensuring fair rental prices, particularly in the context of work and finance.
