New rules for rent increases

Introduction

The 5th Inflation Reduction Act under Tenancy Law (MILG) and the Rent Value Assurance Act (MieWeG) came into force on 1 January 2026. This is the first time that value protection clauses have been comprehensively regulated by law - and largely also for existing tenancies. Check this for your rent increases in 2026.

The most important changes at a glance

1. Standardised model for calculating residential rents
   In future, a standardised legal system for rent adjustment will apply to main tenancies and sub-tenancies of flats within the full or partial scope of application of the MRG.
   This does not include detached and semi-detached houses, co-operative flats (unless special regulations apply) or rental agreements for business premises
2. Adjustments only permitted once a year
   In future, rents may only be adjusted once a year - on 1 April. This applies even if the contractual agreement provides otherwise.
   Different transitional provisions apply to old contracts and new tenancy agreements concluded from 1 January 2026.
3. Inflation index used
   The valorisation is initially based on the average annual change in the Consumer Price Index 2020 (CPI 2020) of the previous calendar year.
4. Statutory cap on rent adjustments
   
   General rule
   A full adjustment is permitted up to an inflation rate of 3 %. If inflation is above 3 %, only 50 % of the excess may be included in the increase.
   Example:
   Inflation 4.5 % → permissible rent increase 3.75 %
   (3 % + (1,5 % / 2))
   
   Special rule for flats within the full scope of application of the MRG
   Stricter transitional limits apply to old flats, council flats and other properties fully subject to the MRG:
   * 2026 (for 2025): Maximum increase 1 %
   * 2027 (for 2026): maximum increase 2 %
   * from 2028: Application of the general rule

The new provisions create more standardisation, but significantly restrict the previous contractual freedom. As both old and new rental agreements will fall under the new rules from 1 January 2026, it is advisable to review existing agreements and rent increases in 2026. Our experts in the field of Real estate You when calculating the respective rent adjustment.

Status: 26/02/2026
^{Source: RIS
Photo: Seven Storm Photography}