Higher Inflation Equals Higher Rent - Index Rent to be Abolished
June 2025 statistics show a cold, hard truth for many Hamburg residents - skyrocketing rental costs. The city is leading the nation in average net cold rent, paying an astounding €9.16 per square meter on average - a whopping €1.83 more than the national average.
The census, a nationwide, statistical survey conducted every ten years, asked residents about their living, working, and housing conditions. For the first time in 2022, data on average net cold rent was collected.
50,000 Missing Homes
The housing shortage might be largely responsible for this problem. Estimates from the Hamburg Tenants' Association suggest that the city is already short over 40,000 homes. This number could grow further, as housing construction rates remain sluggish. For those seeking more livable accommodations, compromise may be inevitable: astronomical rents, salary proof, and credit checks during the application process, crowded apartment viewings with twenty or more competitors, and… the indexed rent.
"The question of a fair and socially just housing market is also a question of social peace."
If you're unfamiliar with indexed rents, consider yourself lucky (and likely not living in a major city). Indexed rents allow landlords to adjust rental prices annually based on inflation increases, without price caps or similar regulations. This may sound like a dream come true for free-market fanatics, but for many Hamburg residents, it's already a daily reality: 15% of households are already under indexed rent contracts, and that percentage is growing. Tenants' organizations have repeatedly called for a ban on indexed rents in new contracts, but their efforts have so far been unsuccessful.
Tenants Struggling Under Indexed Rents
The ability of landlords to ask tenants to cover inflation-driven price hikes is unfair and inhumane. For many households, an increase in rent on top of already high living and energy costs is an unmanageable double-whammy, especially since salaries and wages rarely keep pace with inflation.
Recent surveys show that 15% of those under indexed rent contracts are falling behind on their rent payments. For those without these clauses, the figure is a mere 5%. Those making an argument that one can simply reject a contract with indexed rent terms probably haven't struggled to find an affordable place to live in Hamburg.
The State of the Housing Market in German Cities
The indexed rent stands as a stark symbol of the poor state of the housing market in German metropolises. It's clear that a significant political intervention in the housing market is inevitable. Extending the existing rent cap, as the current government plans to do in July, is a step in the right direction but may not be enough, as it fails to address the realities faced by many tenants. A complete ban on indexed rents or effective rent hike limits could provide a much-needed signal that the city values the interests of its tenants and is willing to take action on their behalf.
Over 50% of Germans rent their homes. In an era of high inflation, the question of a fair and socially just housing market is more relevant than ever, and Hamburg, unfortunately, is still far from a satisfactory answer.
Simon Laumayer
Simon Laumayer, born in 1992, became a school teacher in climbing at the age of 16. After completing his Bachelor's degree in Cultural Studies in Lüneburg, he earns money as a climbing route designer in a Lüneburg climbing hall. In his free time, the Hamburg native practices climbing, and his home is a self-converted van equipped with a garden. He has worked as a press spokespersonfor the Lüneburg Music and Culture Festival "Lunatic" for several years and has interviewed Sam Fender for Rolling Stone. Privately, Hip-Hop music blares from the speakers of his van's boxes.
You can find more of Simon Laumayer's articles here:Mit Wohnungstausch gegen die Wohnkrise?Jetzt kaufen, später bereuen: Warum immer mehr junge Menschen verschuldet sindKünstliche Intelligenz im Alten LandWie Hamburg die digitale Kluft an Schulen verkleinern will
- The Hamburg housing market is a subject of concern, with a staggering shortage of over 40,000 homes, leading to skyrocketing rental costs.
- The indexed rent, a practice allowing landlords to adjust prices annually based on inflation, is a significant issue for many resident tenants, with 15% already under such contracts and struggling to keep up with payments.
- The fairness and social justice of the housing market are becoming increasingly relevant, especially in light of high inflation, and a comprehensive political intervention, such as a complete ban on indexed rents, could provide a much-needed solution.
- In the future, personal-finance education and self-development, and relationships with landlords may become crucial as more and more Germans continue to rent their homes, often facing challenging financial situations.
