Tenancy Law Basics for Landlords in Bavaria

Tenancy Agreement: Fixed-Term or Open-Ended?

Open-ended tenancy agreements are the norm in Germany. Fixed-term tenancy agreements (Zeitmietverträge) are only permitted if a specific reason for the fixed term is stated in the contract, e.g. personal use after the term ends, planned renovation or conversion.

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Notice Periods

Notice given by the landlord: Depends on the length of the tenancy.

Notice given by the landlord always requires a legally recognised ground for termination (personal use, serious breach of contract, economic exploitation of the property).

Notice given by the tenant: Always 3 months, regardless of the length of the tenancy.

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Rent Increases

Adjustment to the local rent index (Mietspiegel): Up to the local comparative rent. A maximum of 20% within three years (cap, Kappungsgrenze); 15% in areas with a tight housing market. Which municipalities are included is set by the Bavarian tenant protection ordinance (Bayerische Mieterschutzverordnung); check the current list of areas. Covered in detail in the guide Rent increases.

Modernisation levy: After a modernisation, 8% of the modernisation costs attributable to the apartment may be added to the rent each year (§ 559 BGB). As a result of modernisation, the monthly rent may rise by a maximum of €2/m² (for rents below €7/m²) or €3/m² within six years.

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Service Charge Statement

The operating cost statement (Betriebskostenabrechnung) must reach the tenant no later than twelve months after the end of the billing period. After that, the landlord can no longer claim additional payments, but any credit due to the tenant must still be paid out.

Recoverable operating costs are defined in the Operating Costs Ordinance (Betriebskostenverordnung, BetrKV): property tax, water, sewage, heating, hot water, lift, street cleaning, refuse collection, building cleaning, garden maintenance, lighting, chimney sweep, insurance and caretaker.

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Deposit

The rental deposit (Kaution) may not exceed three months' rent excluding service charges. The tenant can pay the deposit in three equal monthly instalments (the first at the start of the tenancy). The landlord must keep the deposit separate from their own assets, at a bank on the usual terms. Information is available from the Deutscher Mieterbund (German Tenants' Association).

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Maintenance Obligation

The landlord is obliged to keep the property in the condition agreed in the contract. This includes the roof, façade, windows, heating, sanitary facilities, electrics and the common areas. Cosmetic repairs (Schönheitsreparaturen: painting, wallpapering) can be transferred to the tenant by contract, but only with valid clauses. Rigid schedules are invalid.

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Smoke Alarms in Bavaria

Since 2018, smoke alarms have been mandatory in all homes in Bavaria. They must be installed in bedrooms, children's rooms and hallways that serve as escape routes. The landlord is responsible for installation, the tenant for maintenance (unless agreed otherwise).

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Personal Use: Requirements and Limits

Personal use (Eigenbedarf) is the most common ground for termination by private landlords. It applies if you need the apartment for yourself, family members or members of your household. The following rules apply:

1. Justification: Notice must be given in writing and must specifically name the person and the reason, e.g. "for my son, who is starting his studies in Bayreuth", not just "personal use".
2. Reasonable grounds: The need must be genuine and plausible. Pretextual personal use makes you liable for damages.
3. Hardship cases: The tenant can object if moving out would cause unreasonable hardship, for example due to old age, serious illness or a lack of alternative housing (§ 574 BGB).
4. Duty to offer: If a comparable apartment in the same building becomes vacant, you must offer it to the tenant who has been given notice.
5. Blocking periods: If a rented apartment has been converted into a condominium and sold, the buyer can only give notice for personal use after three years; in areas with a tight housing market, this period can be up to ten years.

For buyers of let apartments, this means: do not count on moving in quickly. More on this under Right of first refusal and Checklist for buyers.

Rent Reduction for Defects

If the apartment has a defect that impairs its use, the rent is reduced by law (Mietminderung) from the time the tenant reports the defect. The amount depends on the individual case. Guide values from case law:

As a landlord, respond quickly to defect reports. With mould, the cause is often disputed: construction defect or incorrect ventilation. A surveyor can clarify this.

Cosmetic Repairs and Moving Out

Many older tenancy agreements contain invalid clauses on cosmetic repairs. The following are invalid in particular:

• rigid schedules ("paint the kitchen and bathroom every three years"),
• final renovation clauses regardless of condition,
• colour requirements during the tenancy,
• renovation obligations for an apartment handed over unrenovated without appropriate compensation.

If the clause is invalid, the tenant does not have to renovate at all. For new contracts, an up-to-date form is worthwhile. And for every handover: a report with photos on moving in and moving out.

Returning the deposit: After the tenant moves out, the landlord may take a reasonable period to check whether any claims remain, usually three to six months. An appropriate portion can be withheld for longer pending an outstanding service charge statement.

Other Duties of the Landlord

• Landlord's confirmation (Wohnungsgeberbestätigung): The landlord must confirm in writing within two weeks of move-in that the tenant has moved in. Without it, the tenant cannot register their address.
• Duty of care for safety (Verkehrssicherung): Paths, stairs and entrances must be safe, including winter clearing, unless this has been validly transferred to tenants.
• Energy performance certificate (Energieausweis): must be presented and handed over before a new tenancy agreement is concluded.
• Data protection: Process tenant data only to the extent necessary.
• Heating period: During the heating period, living spaces must be heatable to around 20 to 22 °C during the day.

Subletting and Pets

Tenants need the landlord's permission to sublet. If the tenant has a legitimate interest, for example because their partner is moving in or they are temporarily living elsewhere for work, the landlord must usually consent to subletting part of the apartment (§ 553 BGB). For pets: small animals are always allowed; dogs and cats are decided case by case; a general ban in a standard-form contract is invalid.

Commercial Tenancy Law: Considerably More Freedom

Most of the protective provisions of residential tenancy law do not apply to office, practice and retail space. There is no rent cap, no statutory comparative rent and no protection against termination in the residential sense. Well-drafted contracts covering term, indexation, service charges and maintenance obligations are therefore all the more important. More under Letting commercial property.

Notice Given by the Landlord: Form and Deadlines

Notice must be given in writing, signed by hand by all landlords. An email is not enough. The reasons must be stated in the notice letter, and the tenant should be informed of their right to object. The notice periods depend on how long the tenant has lived there:

If notice is delivered after the third working day of a month, the end date moves back by one month. Termination without notice is only possible for serious reasons, such as substantial rent arrears or serious disturbance of the peace in the building, usually after a prior written warning.

If You Buy or Sell a Let Property

When ownership changes, the tenancy agreement remains in force. The buyer takes over all rights and obligations, including the deposit. Important for both sides:

• Seller: Hand over tenancy agreements, rent changes, service charge statements and proof of deposits.
• Buyer: Inform tenants of the change of ownership and the new bank details. Rent increases and notices only take effect from registration in the land register (Grundbuch), or from the time the buyer becomes the landlord.
• Deposit: The seller remains liable if the buyer does not repay the deposit when the tenant moves out. That is why it is transferred in the purchase contract.

More on this under Selling a property: the process.

Modernising Let Apartments

Landlords may modernise, but must announce the work at least three months in advance in text form, stating the type, scope, start, duration and expected rent increase. Tenants must generally tolerate modernisation but can invoke unreasonable hardship. The rent may be reduced during the building work, although for energy-efficiency modernisations only after three months. The guide Rent increases explains how costs are passed on to the rent.

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