Owner-occupation notice in Germany (Eigenbedarf)

What the Code says

Under § 573 (1), a landlord may terminate an open-ended tenancy only with a legitimate interest, and a termination to raise the rent is ruled out. Section 573 (2) No. 2 names own-use need as a typical example: the landlord needs the rooms as a home for themselves, their family members or members of their household. The Code does not define “family members” or list how close the relationship must be, and it does not say how a court should judge whether the need is real.

The Civil Code requires the reasons for the legitimate interest to be stated in the termination letter; other reasons are taken into account only if they arose later (§ 573 (3)). The notice must be in written form (§ 568 (1)). A letter that gives no reason does not meet that requirement; a lawyer or tenants’ association can check whether the reasons given are enough.

Notice periods

The ordinary periods apply (§ 573c (1)): notice by the third working day of a month, ending at the end of the month after next, lengthened for the landlord by three months after five years and by another three after eight years since handover. That gives three, six or nine months. See notice periods. An agreement shortening these periods to the tenant’s disadvantage is void (§ 573c (4)).

Two points are separate from own-use need. A landlord who lives in a building of no more than two flats may terminate without a legitimate interest, with three extra months (§ 573a); then no own-use reason needs to be given, though the letter must say which provision is relied on. Housing let for temporary use, and certain rooms inside the landlord’s own home, are outside the protection (§ 549 (2)).

The hardship objection

The tenant may object to the notice and demand continuation if ending the tenancy would mean a hardship for the tenant, the family or a member of the household that is not justified even considering the landlord’s legitimate interests (§ 574 (1)). A hardship also exists where reasonable replacement housing cannot be obtained on acceptable terms (§ 574 (2)). When weighing the landlord’s interests, only the reasons stated in the notice are considered, unless they arose later (§ 574 (3)). The right does not exist where there is a ground for termination without notice.

Form and deadline. The objection must be declared in text form, and the tenant should, if asked, say promptly why (§ 574b (1)). The landlord can refuse continuation if the objection was not received at least two months before the tenancy ends (§ 574b (2)). The landlord should point out the possibility, form and deadline of the objection in good time (§ 568 (2)); if the landlord did not do so in time, the tenant may still object at the first hearing in the eviction proceedings (§ 574b (2)).

Result. The tenant may demand continuation for as long as is reasonable considering all circumstances; if the landlord cannot be expected to continue on the old terms, the terms can be adjusted. If no agreement is reached, a court decides on whether and how long the tenancy continues, and if it is unclear when the circumstances will end, it may order continuation for an indefinite period (§ 574a).

A worked example of dates (not a real case): a landlord’s notice received on 3 January at the latest, after four years of tenancy, ends the lease on 31 March; the objection must reach the landlord by 31 January at the latest.

After a flat is sold or converted

If a rented home is sold, the buyer takes over the tenancy (§ 566 (1)). Own-use termination by the buyer is not immediately available in two situations that § 577a sets out:

1. Where condominium ownership was created after the home was handed to the tenant and the unit was sold: the buyer can rely on own-use need (or the economic-use reason) only after three years from the sale (§ 577a (1)).
2. Where the home was sold or encumbered to a partnership or several buyers after handover, the same restriction applies, unless the buyers belong to the same family or household, or condominium ownership had been created before the tenant took over (§ 577a (1a)).

The three years extend to up to ten years where the supply of rented housing is particularly at risk in a municipality or part of it and the state government has designated it by ordinance for a period of at most ten years each time (§ 577a (2)). So the length depends on the state ordinance. Whether and how long your municipality is covered is for the state’s current ordinance; do not assume that a rule from another state applies.

When the units are first sold after conversion, the tenant also holds a right of first refusal if the landlord sells to a third party, unless it is sold to a family member or household member (§ 577). The seller must tell the tenant of the contract terms and the right; the tenant exercises it in writing (§ 577 (2) and (3)).

Fixed-term leases for own use

A landlord can agree a fixed term only if the reason, such as own use after the term, is communicated in writing at signing (§ 575 (1)); otherwise the lease is open-ended. The tenant can ask four months before the end whether the reason still exists (§ 575 (2)).

Which professional to consult

A tenants’ association or a lawyer specialised in tenancy law can assess a notice letter and the objection. Payotte does not recommend individuals.