Temporary rental contracts

Temporary rental contracts / Zeitmietverträge

June 13, 2023

What is a temporary rental contract?

A fixed-term rental contract (also known as a "temporary rental contract") is a rental contract that is only concluded for a specific period of time. In principle, rental agreements are concluded for an indefinite period. A rental agreement is valid for all eternity unless it is terminated. This is different to a temporary rental agreement, which automatically ends when the time expires.

Under what conditions can a rental contract be limited in time?

Time rental agreements are regulated in section 575 BGB. The legislator considered the limitation of a rental agreement to be an exception, which is why a limitation is only possible under certain conditions.

Legitimate interest of the landlord/landlady

According to section 575 BGB, a temporary rental contract can be concluded if the landlord/landylady can claim an interest in the limitation of the rental contract. However, the legislator only recognises certain interests in a fixed-term lease.

Section 575 (1) BGB lists these interests in an enumerative form. Accordingly, the interest can either be that the landlord/landlady wants to use the rooms as a dwelling for themselves, their family members or members of their household (No. 1), or wants to remove the rooms in an admissible manner or to change or repair them in such a substantial way that the measures would be made considerably more difficult by a continuation of the tenancy (No. 2), or wants to rent the rooms to someone who is obliged to provide services (No. 3).

Reason for limitation in writing

In any case, the landlord/landlady must inform the tenant in writing of the reason for the time limit when the contract is concluded. For this purpose, the requirements of the written form according to section 126 BGB must be observed. According to the case law of the Federal Court of Justice, high demands must be made on the content of the notification. For example, it is not sufficient for the landlord/landlady to repeat the legal text of section 575 BGB in a general way. The tenant must be able to check, on the basis of the notification, on what factual circumstances the limitation is based - and whether this information is true.

No obligation of the landlord/landlady to inform about legal consequences of the time limit

The landlord/landlady does not need to inform about the legal consequences associated with the time limit.

No time limit on the duration of the fixed term

According to the case-law of the Federal Court of Justice, there is no time limit on the term of the lease, which even considered a 10-year term to be effective.

Consequences of an effective time limit

The effective limitation of the lease has far-reaching consequences. Temporary rental agreements can initially only be terminated extraordinarily, this follows from section 542 (2) BGB. For this reason, sectiom 574 BGB (objection to termination) is also not applicable to temporary rental agreements, unless there is an extraordinary termination. Nor can the tenant be granted a period of eviction by the court in accordance with section 721, 794 a of the Code of Civil Procedure (ZPO). A temporary tenancy agreement cannot be terminated in an ordinary manner, i.e. the landlord/landlady "pays" the specified rental period by losing the ordinary right of termination.

Consequences of an ineffective time limit

If there is either no interest entitling the tenant to a time limit or if this interest was not or only incompletely communicated to the tenant at the time of conclusion of the contract or not in writing, the time limit shall be invalid. The consequence of the ineffective time limit is not that there is no rental agreement at all, but that the rental relationship is deemed to have been concluded for an indefinite period of time in accordance with section 575 (1) sentence 2 BGB. In this case, however, the tenancy can also be terminated "normally".