The Administrative Court Berlin (VG Berlin) has ruled that the required seriousness of letting efforts is lacking when residential space is offered at an obviously above-average rent.
VG Berlin, Decision of 28.05.2024 – 6 L 125.24
VwVG § 14; ZwVbG-BE (Misuse Prohibition Act Berlin) § 4 para. 1
KFR – Kanzlei für Real Estate explains the background and significance of the decision for owners and project developers.
The case: Vacancy despite letting offers
The applicant unsuccessfully seeks interim legal protection for the suspension of the immediate enforcement of notices imposing administrative fines to enforce residential use orders under misuse prohibition law. The applicant, as a project developer, had a residential building with a total of six residential units constructed. Three of the residential units were neither sold – as originally intended – nor let. Due to the vacancy, the applicant was repeatedly requested to make the relevant residential units available for residential purposes. Despite listings on real estate portals, the applicant was unable to let the units on a long-term basis, resulting in multiple administrative fines being imposed against the applicant.
More on legal questions regarding vacancy and misuse – click here.
Decision of the VG Berlin
The court derives a lack of seriousness in the letting intention from the level of rent demanded by the applicant for the residential units. The court finds that the rents originally demanded by the applicant were obviously above average even for the upper market segment in that residential location and would therefore likely fulfill the objective elements of excessive rent pursuant to § 5 para. 2 sentence 1 of the Economic Offences Act of 1954. Even though the applicant significantly reduced the rents demanded for the residential units, there was a lack of substantiated submissions regarding current letting efforts.
Requirements for serious letting efforts
According to the court, it is not sufficient to demonstrate serious letting efforts merely by referring to listings on real estate portals. The applicant had not adequately demonstrated whether
a. inquiries from potential tenants on the respective real estate portal were responded to at all, and whether
b. viewing appointments were arranged beyond that.
The applicant also failed to provide evidence that the viewing appointments cited by her actually took place. Furthermore, in the court’s view, the applicant failed to provide an explanation as to why no lease agreement could be concluded despite the viewing appointments cited by her.
Independently of this, the court considered the fact that only a few viewing appointments were realized over a period of approximately seven months (assuming these took place) to speak against serious letting efforts, as this appeared implausible given the general housing shortage. Finally, the fact that the property was a new build was not material to the court’s decision.
Practical note from KFR – Kanzlei für Real Estate
The decision illustrates that in practice, high requirements are placed on the demonstrability of serious letting efforts. In particular – but not exclusively – conclusions regarding letting intention can be drawn from the rent. In addition, the number of viewing appointments is considered relevant.
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