Bavaria tightens the rent cap: What will change for new lettings, rent caps and rent index in 2026

Bavaria tightens the rent freeze - what this means for owners and tenants in 2026

The rent freeze remains a key issue on the Bavarian property market. It is expected to be tightened up in Bavaria from 2026: The „tight housing market“ area is expected to be updated and application will become stricter. The basis for this is the nationwide rent law, which gives the federal states leeway in the designation of areas and the cap limit. For owners, this means that new lettings and rent increases must be justified even more precisely. For tenants, the following applies: know your rights, complain properly and realistically assess your chances. We summarise the most important points below - based on facts and with practical examples. (Assumptions about 2026 are labelled as such).

What will change in Bavaria in 2026?

Assumption based on current developments: The Free State is updating the list of areas under pressure and extending the corresponding ordinances. At the same time, the application of the rent cap in more municipalities will be set at 11 per cent over three years. In addition, qualified rent indexes are becoming more comprehensive and methodologically tighter, which more accurately reflects the local comparative rent.

• Extension/redefinition of the „tight housing market“ area (assumption).
• More consistent application of the Rent control for new lettings (starting rent max. 10 % above the local comparative rent).
• More frequent use of the Capping limit of 11 % in 3 years for existing rents (assumption).
• More qualified Rent index with narrower ranges and clear residential value features.
• Stricter obligations to provide justification and evidence for landlords in the event of a dispute.

New lettings 2026: Room for manoeuvre and stumbling blocks

For re-letting in tight areas, the starting rent may not be more than 10 % above the local comparative rent. Important exceptions: New buildings (first occupancy from 2014) and flats built after Comprehensive modernisation. In addition, the higher Pre-rental up to the previous amount - provided it was lawful at the time. With Graduated rent or Index-linked rent The following applies: The initial initial rent is decisive; it must be brake-compliant.

Typical errorsSet starting rent without reliable proof of rent index; interpret „comprehensive modernisation“ too generously (a considerable amount of investment is required, typically around a third of the value of a new building); agree on scales even though the starting rent is already too high.

Existing rent: Cap, modernisation, index

Different rules apply to current tenancies than to new tenancies. In Bavaria, the Capping limit be reduced to 11 % in three years in strained areas (assumption for 2026). Outside of tight areas, 15 % in three years generally applies. The basis for rent increases is the local comparative rent (rent index, comparable flats or expert opinion).

Modernisations can be carried out via the Modernisation levy can be partially passed on to the rent (currently 8 % of the costs attributable to the flat per year, capped). It is important to give legally compliant notice, to distinguish between maintenance and repairs and to check the capping limits or caps per square metre.

With Index-linked leases the rent is based on the consumer price index. Planned tightening or restrictions are being discussed politically; a precise review of the contract form is advisable for 2026 (assumption: no blanket retroactivity, but stricter consultation practice).

Brief calculation example cap limitNet cold rent today € 900. In an area with a % limit, a maximum of €999 is permitted within three years - provided that the local comparative rent allows for this. If the rent index is lower, it sets a limit; the lowest limit counts.

Opportunities for owners - utilise them professionally

Even with tighter brakes, there is still legal room for manoeuvre. Data quality and timing are crucial: those who present the property with an up-to-date rent index, complete furnishing documentation, plausible photos and structural evidence often achieve the highest legally secure rent and minimise the risk of litigation. In addition, a smart modernisation strategy increases market appeal - for example, through energy efficiency, bathrooms, floor plan optimisation and digital features.

• Rent index check: Record object characteristics precisely, justify range, collect evidence.
• DocumentationInvoices, building specifications, energy performance certificates, photos - file in an audit-proof manner.
• Form of contract: Scales/index only with brake-compliant initial rent and comprehensible clause.
• TimingPlan rent increases in good time, adhere to deadlines and justifications.
• CommunicationTransparent derivation increases acceptance and reduces complaints.

What tenants should consider now

Tenants can use a qualified reprimand apply the brake. This requires a concrete justification (e.g. reference to the rent index) and prompt action. If you have any doubts, you should ask for documents and offset your own rent. Important: Note the exceptions (new build, extensive modernisation, lawful previous rent) - not every high rent is unlawful.

Conclusion2026 is expected to bring more precise, more strictly applied rent regulation in Bavaria. For owners, this means: data, justifications and processes must be in place. For tenants: Know your rights, check objectively, complain properly. A professional approach reduces conflicts - and increases predictability.