Rent cap or rent cap: What awaits tenants?

Rent cap or rent cap: What awaits tenants?

The rent cap recently passed by the National Council and Federal Council has been sharply criticized. FPÖ General Secretary NAbg. Michael Schnedlitz and residential spokesman NAbg. Michael Oberlechner poses shocked at the “dilettantism” of the government, which, despite its well-meaning intentions, has presented a regulation that turns out to be flawed. According to Schnedlitz, those responsible must correct the error immediately, otherwise this could be seen as an admission that the accommodation of tenants was not the true motivation for this legislative initiative, but simply a tactical campaign to attract voters.

The problem is that the regulation, which was intended to stop rent guideline increases from April 1st, only applies to new rentals. Contracts in which rent increases are linked to the consumer price index remain legally unaffected. This could result in up to 50 percent of all existing rental agreements being inadequately protected. Experts from the tenants' association pointed out that the new regulations are not sufficient to provide real relief for tenants and criticized the lack of a realistic approach to unregulated tenancies in new private buildings.

Criticism and analysis of the rent cap

The rent cap, which the government introduced in December 2023, is intended to apply to around 1.2 million households, but there are key exclusions. Around 425,000 households in the unregulated private sector, which also include business premises, do not benefit from this measure. The tenants' association confirms a trend backwards in rental policy, which means that many tenants are still burdened disproportionately. The new regulations do not guarantee the necessary relief given the rising cost of living.

In addition, it is predicted that rental prices for category tenants could even rise, while the tenants' association is proposing a model that envisages a real rent cap with a cap of 2 percent per year, regardless of building age or contract details. It still remains uncertain whether and how the government will respond to these increasing criticisms, while many tenants continue to look anxiously at their next rental bills.

More detailed information on the effects of the rent cap was analyzed in detail by the tenants' association, as recorded on their website.