Crisis-related protection against dismissal

The coronavirus pandemic presents us with an unprecedented situation, raising many new questions regarding tenancy law. Therefore, both the German Tenants' Association and the homeowners' association Haus & Grund point out that the following answers are preliminary assessments and not binding legal advice.

Short-time work, layoffs, business closures, or a lack of orders: The measures to contain Covid-19 have led and continue to lead to economic downturns and financial difficulties for many employees, business owners, and self-employed individuals. Income is lacking, while ongoing costs continue. Rent and utility costs, in particular, are taking their toll.

To prevent tenants from being evicted if they fall into financial difficulties due to the coronavirus pandemic, the German Bundestag passed a temporary amendment to tenancy law on March 25. Normally, according to Section 543 of the German Civil Code (BGB), a landlord is permitted to terminate a tenancy if the tenant fails to pay rent for two consecutive months. "These regulations are intended to prevent residential tenants from losing their homes and tenants or lessees of commercial premises and land from losing their livelihoods as a result of temporary income losses caused by the SARS-CoV-2 virus pandemic," explains a document from the Federal Ministry of Justice and Consumer Protection (BMJV). However, the tenant must provide proof, for example, a certificate from their employer, that the coronavirus crisis is the reason for the payment arrears.

The crisis-related protection against dismissal will initially apply until the end of June; however, should the pandemic continue, the federal government intends to extend it until September.

As a general rule, the rent must be paid in full. However, the tenant may suspend payment or pay in installments. This also applies to utilities. The tenant then has until June 2022 at the latest to settle any outstanding rent.

A rent reduction is not an option (unless the landlord offers it voluntarily), as this would require the rental property to have a serious defect. "The pandemic, however, is not a defect in the rental property," clarifies Jutta Hartmann of the German Tenants' Association. Even if a neighbor contracts Covid-19, this is not grounds for a rent reduction.

Tenants are only entitled to a rent reduction if their ability to live in their apartment or house is significantly impaired by serious factors such as power, heating, or water outages. However, this is unlikely, as tradespeople are permitted to work even during the pandemic – provided they maintain a distance of at least 1.5 meters. (These rules were in effect at least until May 3rd; further developments were not yet foreseeable at the time of publication of this newsletter – editor's note.).

What about apartment viewings and moves, given that contacts are to be drastically reduced (at least until April 19th)? According to the Munich Tenants' Association, tenants can refuse visits from prospective tenants during this time, as viewings are not considered essential.

Moving is generally permitted, but tenants should hire a moving company instead of relying on help from family and friends. Or even better: to protect everyone, postpone the move and temporarily withdraw the notice of termination. As long as finding a new tenant proves difficult, this also benefits the landlord. Mutual understanding and cooperation between tenants and landlords are more important than ever in exceptional times.

Sources: Federal Ministry of Justice and Consumer Protection (BMJV), ratgeber-immowelt.de, German Tenants' Association, Haus & Grund, spiegel.de, n-tv.de, lawio.de