How do rental contracts work in Germany?

A complete guide to rental contracts in Germany in 2023

If you’re reading this article, you’re probably thinking about moving and living in Germany, or perhaps you’re just curious about how things work in the country of efficiency, fast cars, and electronic music.

In this guide, we will discuss rental agreements in Germany, an essential topic for anyone who wants to start a new adventure on German soil.

If you wish to live in Germany, understanding the details of local rental agreements is essential.

Knowledge of German regulations can be helpful in guiding you as best you can in your choice of living in Germany as a tenant.

In this guide, the Spacest Team will provide you with an overview of rental contracts in Germany in 2023.

Types of rental contracts in Germany

To live as a tenant in Germany, as in many other countries, there are different types of tenancy contracts, each with its own specific characteristics:

• Open-ended contract (Unbefristeter Mietvertrag): this is the standard and most common contract. It does not have an expiration date and can be terminated only by complying with established notice periods;
• Fixed-term contract (Befristeter Mietvertrag): as the name suggests, has a fixed term. At the end of the agreed period, the contract automatically ends;
• Sublease contract (Untermietvertrag): in this case, the main tenant (who has a direct contract with the landlord) rents a part or the entire property to a third party;
• Contract for students or temporary workers: many students or temporary workers opt for this type of contract, often offered by university residences or companies for their employees.

What you need to know before signing a rental contract in Germany

On your path to living in Germany and signing a rental contract in Germany, you need to know that in addition to the monthly rent, there may be additional fees and clauses such as:

• Security deposit: it is common practice in Germany to pay a security deposit before moving into an apartment. This serves as security for the landlord and is usually equivalent to two or three months’ rent;
• Nebenkosten: in addition to the “basic” rent, there are incidental charges that cover services such as heating, water, electricity and maintenance. Be sure to clarify which are included in your lease in Germany and which are not;
• Kündigungsfrist: this is the notice period you have to give if you decide to leave the apartment. It is usually three months, but can vary depending on the contract.

To get an idea, take a look at our best rental listings in Germany in Berlin.

How does a rental contract in Germany come together?

If you are planning to live in the German state, make sure the rental contract in Germany contains:

• Details of the parties involved;
• Details about the property;
• Type of rental agreement;
• Details on duration, price, payment terms, etc;
• Regulations for utility bills and notice periods;
• Energy classification.

Aspects to consider in rental contracts in Germany in 2023

1. A rental agreement in Germany must also state the amount of pure rent excluding expenses, in German Kaltmiete, and specify the rights and duties of the landlord and tenant;
2. Together with the rental contract in Germany it is always advisable to draw up a handover report (Übergabeprotokoll) where the conditions in which the apartment is handed over to you and the conditions for its return (e.g. painting of the walls) are listed;
3. In the case of renting furnished accommodation, we always recommend that you also attach to the rental agreement an inventory of all furniture, appliances and items that will be handed over to you;
4. Remember that once you sign the lease in Germany, both you and the landlord are bound by the conditions you sign: if you are not fluent in German, you can get help from a native speaker or a local tenants’ association;
5. It is advisable to take out, with any insurance company, a Hausratversicherung, that is, an insurance that is able to cover any damage in the apartment (water leakage, fire, theft, etc.);
6. When signing the contract, the landlord must provide you with the Energieausweis (energy certificate), which is a certificate where the energy consumption class of the building is indicated.

In summary, living in Germany can be an exciting experience, but having a clear understanding of tenancy contracts can make the process much easier and more enjoyable: contact our Team of experts.