Rent reduction — what Landlord you must do now
When the letter stating 'reduction of 30 % due to water damage' lands in your letterbox, panic sets in. We explain when a rent reduction is justified, how high it may be — and how you, as the landlord, must respond to avoid falling into the debtor trap.
When is a rent reduction justified?
The rent can be reduced if the flat has a Defect — defined as a "deviation of the actual condition from the contractually owed target condition" (German Civil Code). Requirements:
- The defect impairs fitness for use (not merely a cosmetic flaw)
- The tenant has NOTIFIED the landlord of the defect (§536c BGB!) — no reduction without notification
- The defect was not caused by the tenant themselves
- The defect is not "insignificant" (de minimis threshold: ~5 % rent reduction)
Common reduction rates (Federal Court of Justice case law)
- Heizungs-Ausfall (komplett) im Winter: 50–100 %
- Heating on, living room only 15°C: 20 %
- Water damage with mould: 20–50 %
- Schimmel im Bad/Schlafzimmer (gesundheitsrelevant): 10–25 %
- Noise from a building site right next to the property: 10–30%
- Lift breakdown (in a ground-floor building): 5–10 %
- Lift breakdown (10th floor, elderly tenant): 25–40 %
- Warmwasser-Ausfall: 7,5–10 %
- Defektes Fenster (Zugluft): 10–15 %
These rates are guideline values from judgments — in individual cases a court may round down or up.
What must you do as the landlord?
- 1. Document the tenant's defect notice (date, photo, type)
- 2. Remedy the defect within a REASONABLE PERIOD — typically 2-14 days depending on severity
- 3. During the defect period: the tenant may pay a reduced amount — you must either accept the reduction OR object with reasons
- 4. After remedy: claim the remaining payment (by letter with a deadline)
- 5. In a dispute over the amount of the reduction: commission an expert report OR file a claim
When may the tenant NOT reduce the rent?
- The defect was NOT reported to the landlord → rent reduction not permitted (§536c(1) BGB)
- The defect was caused by the tenant themselves (mould from failing to ventilate, a damaged window)
- The defect was known and accepted at move-in (e.g. poor sound insulation)
- Trivial defect (e.g. a hairline crack in the wall) — reduction not enforceable
- A cosmetic flaw without any impairment of use (e.g. a chipped corner of plaster)
Caution: obligation to repay in the event of an unlawful reduction
If you can ultimately PROVE that the tenant reduced the rent unjustifiably (e.g. because they did not report the defect OR there was no defect at all), you can sue for the full rent retroactively — including default interest + legal costs.
Practical example
The heating fails in November. The tenant reports it to you on 3 Nov. You commission a plumber on 4 Nov, and the repair takes place on 12 Nov (9 days of outage).
- Justified reduction: approx. 50 % for the 9 days = 9/30 × 50 % = 15 % of the monthly rent
- At 1,000 € rent: 150 € reduction for November
- Had you reacted FASTER (emergency service on 3 Nov = days 4-6 with a 50 % reduction instead of 9 days): only 100 € reduction
How Rentprime helps you
Rentprime has a Damage/defect inbox: the tenant reports defects directly in the portal with a photo + description, the system documents the date + receipt, reminds you of the 14-day repair deadline, documents your response (commissioning a tradesperson, appointment, remediation date) and, in the case of a justified reduction, automatically calculates the rate according to the Federal Court of Justice table.