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RENTING

How tenants in Austria can save money from July 2023

Starting Saturday, a new law comes into effect in Austria that will save tenants a fee that can typically amount to the equivalent of two months rent.

Published: 30 June 2023 17:11 CEST
How tenants in Austria can save money from July 2023
Tenants could see some relief around a particular brokerage fee starting in July. (Photo by Abi Tripp / Unsplash)

Saturday’s big change for tenants concerns the payment of brokerage fees, also known as “Provision.”

The federal government has announced an amendment to the renter’s law, introducing the buyer’s principle, or Bestellerprinzip, for apartment rentals.

Under the current system, tenants are responsible for various fees, including a security deposit and the first month’s rent when they move into a new apartment. One of these fees is the Provision, a brokerage fee equivalent to two months’ rent, which tenants must pay even if they find the apartment online or if the property owner is the one who engages the services of a brokerage firm.

However, starting in July, the responsibility of paying the brokerage fee will be on the party that hires the real estate agency.

Unless the property is privately rented directly by the owner without involving a brokerage firm (in which case there should be no fee), the cost will now need to be paid by the individual or entity that engages the agency’s services.

This change aims to provide a fairer and more transparent system for tenants, relieving them of the financial burden of paying the brokerage fee when not using the services of a real estate agency for apartment rentals.

READ MORE: CONFIRMED: Austria to scrap broker’s fee on apartment rentals in 2023

Some rents to increase

However, renters aren’t completely off the hook when it comes to rising costs.

Starting from July 1st, Austria will see a 5.51 percent increase in category rents, impacting approximately 135,000 households nationwide.

READ ALSO: Renting in Austria: When can my landlord increase the rent, and by how much?

The Rent Law Act mandates that if inflation surpasses 5 percent, the Minister of Justice must declare a rent increase.  This adjustment applies to all tenants residing in buildings governed by the Tenancy Act (MRG) and whose lease agreements were entered into before March 1st, 1994.

Therefore the effects are generally limited to those on very old leases.

Member comments

  1. Maybe I’m not reading this correctly. Apparently we still have to pay the fee if the agent posts the apartment online? But if an apartment is posted online, the agent/agency has been hired by the landlord, correct? Or do we (tennant) still have to “hire” the agency? If this is the case, the law is completely useless. Greatful for some answers/clarity. Thanks in advance

    1. Hi! If the apartment has been posted online, it may have been done so by the landlord (in which case there should be no fee for anyone) or by the agency that the landlord hired (in which case the landlord pays for the service). Tenants will only pay a brokerage fee if they hire an agent.

      I hope that clarifies things, but long story short: the person that hires a brokerage firm pays for the service.

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RENTING

What tenants in Austria need to know about getting their rent reduced

From construction noise to broken utilities, various issues can allow tenants in Austria to request a rent reduction. Learn the steps to follow and when legal action might be necessary.

Published: 19 September 2024 15:02 CEST
What tenants in Austria need to know about getting their rent reduced

In Austria, tenants can legally request rent reductions if their rental property’s usability is significantly impaired. 

According to MieterHilfe, the association that helps renters in Vienna, Section 1096 of the Austrian Civil Code (ABGB) regulates this. The ABGB covers rental agreements for all properties. 

The law offers protection when tenants experience issues like heavy construction noise or utility outages (such as gas, electricity, or water). However, knowing when and how to apply for a rent reduction and understanding the process can be tricky. Disputes often end up in court and are decided on a case-by-case basis.

READ ALSO: Can my landlord in Austria increase the rent whenever they want?

When you can ask for a rent reduction

If your rental property’s usability is restricted, you can apply for a rent reduction. Common examples of restricted usability often include disruptions in gas, electricity, or water supplies, major construction noise from remodelling, damage to property that prevents proper use, such as a broken heating system, and more. 

Importantly, tenants can claim a rent reduction even if the landlord is not directly responsible for the impairment. However, the extent of the usability issue must be clear, and the tenant must notify the landlord to allow them to fix the problem. Additionally, if a tenant repairs the issue, the rent reduction period ends as soon as the repair is made.

Not all impairments qualify for a rent reduction, though. For example, minor inconveniences or defects, issues that the tenant was aware of when signing the lease, impairments caused by the tenant’s actions and situations where the tenant has already waived the right to a reduction do not count.

An attic room can get extremely hot without air conditioning (Photo by Jakub Żerdzicki on Unsplash)

If there is a dispute, the court will decide the extent of the rent reduction, considering objective and subjective factors. For example, households with small children or pregnant women might receive higher reductions.

READ ALSO: Tenant or landlord: Who pays which costs in Austria?

MieterHilfe has a table with many recent cases that can give you an idea of the causes of rent reduction and the amount tenants received. For example, in one case in Vienna, the flat had significant mould infestation, and the tenants received a 75 percent rental reduction. In another case, rent was reduced by 30 percent because of “unhealthy odours” from the rubbish room that affected half of the flat.

In one case, dangerous electrical cables were accessible inside the flat, and the tenant did not have to pay any rent until the issue was fixed.

Things get more complicated when it comes to noise. In one case in 2005, the tenant got a 15 percent rent reduction due to the consequences (noise and smell nuisance) of a garage construction in the neighbouring property, but not a reduction when the next-door property was doing “normal construction work.”

Another common complaint tenants have is regarding heat, especially in Dachgeschoss apartments (attic apartments), which can get extremely hot due to the lack of ventilation and their location in buildings. In one case, the air conditioning system was positioned so unfavourably that the rooms were not cooled —the tenant got a 6 percent reduction in rent.

In another, though, the complaint regarding excessive heating was dismissed, and the tenant received no reduction because they had rented the room without any reservation or questioning, even though the place had no sun protection or air conditioning.

READ ALSO: What happens when my rental contract expires in Austria?

Legal action and rent payment strategies

Tenants must be cautious when pursuing rent reductions, the renter’s association say. Two approaches are commonly used.

You can continue paying the total rent while negotiating. The tenant informs the landlord about the issue and continues paying the total rent but reserves the right to claim a reduction later. This can be useful in avoiding eviction risks.

Or, they can reduce rent directly. This means the tenant pays a reduced amount but informs the landlord in writing. If the landlord disagrees, they may take legal action, and the court will decide the appropriate – if any – reduction.

In both cases, it is essential to notify the landlord in a verifiable form, such as a registered letter, to ensure the process is documented.

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