Mietrechtspaket II: What the New Federal Legislation Means for Furnished Housing and What Property Owners Should Do Now

An Article by White Apartments | June 2026

Current Status: Cabinet Approval but Not Yet in Force

Political pressure on furnished housing is currently coming from two directions at the same time. At the Berlin state level through the new approval requirement in Social Preservation Areas (Milieuschutz Areas) introduced in April 2026, and at the federal level through a comprehensive reform of tenancy law. This reform is called Mietrechtspaket II(Tenancy Law Package II) and affects all landlords of furnished apartments in Germany.

Timeline of the legislative process so far:

• June 2025: Extension of the rent brake until the end of 2029
• September 2025: Establishment of a 20-member expert commission
• February 2026: Presentation of the draft bill by Federal Minister of Justice Stefanie Hubig
• April 2026: Approval of the government bill by the Federal Cabinet
• June 2026: Parliamentary proceedings in the Bundestag and Bundesrat
• Expected entry into force: Earliest autumn 2026

Important: Mietrechtspaket II is not yet in force. Existing tenancy agreements remain unaffected. However, anyone planning or entering into new furnished rental agreements today should already begin preparing for the upcoming regulations.

What Mietrechtspaket II Proposes

1. Furnishing Surcharge: Transparency and Limits

The most significant change for landlords of furnished apartments concerns the furnishing surcharge.

Until now, the surcharge could be included in the total rent and was often not disclosed separately. The new legislation aims to make this much more transparent.

The proposed rules include:

• The furnishing surcharge must be listed separately in the tenancy agreement.
• The surcharge will be capped at a maximum of 10 percent of the net basic rent.
• Alternatively, landlords may charge up to 1 percent per month of the documented current value of the furniture.
• For fully furnished apartments, a flat-rate surcharge of 5 percent of the net basic rent may be applied.
• Higher surcharges remain permissible if they can be justified by the actual value of the inventory.
• If the furnishing surcharge is not separately disclosed in the tenancy agreement, the apartment will legally be considered unfurnished.

2. Short-Term Rental Agreements: Stricter Limits

The rules governing furnished fixed-term rental agreements are also expected to become stricter.

Proposed changes include:

• Exemptions from tenant protection regulations will only apply to rental periods of up to six months.
• Extensions up to eight months will only be permitted if the tenant’s temporary need unexpectedly continues.
• In tight housing markets, rental periods exceeding six months will generally be presumed not to constitute temporary use.
• Landlords who exceed the eight-month limit or fail to document the tenant’s temporary need risk having the agreement reclassified as an open-ended tenancy.

3. Indexed Rents: Limitation During High Inflation

In areas with tight housing markets, inflation-related rent increases exceeding 3 percent per year may only be passed on to tenants at half the rate.

For landlords using indexed rent agreements, this represents a significant limitation on future rent adjustments.

4. Grace Period Payments and Protection Against Termination

The existing grace period payment mechanism is expected to be expanded.

In the future, tenants may be allowed, on a one-time basis, to prevent even an ordinary termination by settling outstanding rent arrears.

What This Means for Furnished Rentals

Mietrechtspaket II does not prohibit furnished rentals. Instead, it introduces new transparency requirements and clearer regulatory boundaries.

Professional landlords offering well-equipped, high-quality apartments are generally expected to adapt successfully to the new framework, provided that they maintain proper documentation of their inventory and furnishing values.

The greatest impact will be felt by landlords who have relied on all-inclusive rental models without adequately documenting the value of their furnishings.

From our perspective, however, there is one significant weakness in the proposed legislation. The new rules do not distinguish between landlords seeking to circumvent rent control regulations and those providing high-quality accommodation for international professionals, project-based employees, researchers, and expatriates.

Particularly in international cities such as Berlin, Hamburg, Frankfurt, and Munich, furnished housing serves an important economic function and should be evaluated accordingly.

Our Recommendations for Property Owners

Create an Inventory Register

Every furnished apartment should have a comprehensive inventory list.

The following information should be documented:

• Purchase price
• Date of purchase
• Current estimated value
• Invoices and supporting documentation

Update Rental Agreements

Existing tenancy agreement templates should be revised in a timely manner.

The furnishing surcharge should be shown as a separate line item and clearly distinguished from the net basic rent.

Review Short-Term Rental Structures

Landlords who regularly conclude rental agreements with terms of less than six months should review their contractual structures and carefully document any extensions.

Recalculate Indexed Rent Agreements

The proposed inflation cap should already be considered in future financial planning and investment calculations.

Seek Professional Advice Early

As the legislative process is entering its final stages, property owners are advised to review their rental strategies now and prepare for the upcoming requirements.

Our Conclusion: Transparency Yes, but With Proportionality

Greater transparency regarding furnishing surcharges is sensible and understandable. Tenants should be able to see exactly what they are paying for, and professional landlords should clearly document the services they provide.

However, we are concerned about the increasing density of regulation. The rent brake, Social Preservation Area restrictions, conversion regulations, and tenancy law reform together create an increasingly complex regulatory environment.

Furnished housing for professionals, researchers, project-based employees, and mobile workers is not a luxury niche. It is an essential component of modern urban development and economic competitiveness. Any further regulation of this sector should therefore be carefully evaluated for its broader economic impact.

White Apartments and Flatkeeper will continue to closely monitor developments and keep clients informed about all relevant legislative changes.