Effective 1 February 2018, the leasehold category amounts in accordance with section 15a of the Austrian Tenancy Act (“MRG”), and thus also the amounts for minimum rent in accordance with section 45 of the MRG, will be increased. This mainly relates to new lease agreements for apartments classified in the worst equipment category (category D) as well as lease agreements which have been concluded prior to 1 March 1994. Since the last increase in April 2014, the legal threshold of 5% has been exceeded for the first time with the index value for October 2017, which is decisive for the valorisation of the category amounts, leading to an increase of 5.2% in the leasehold category amounts.

The new values at a glance:

Category Amounts (EUR/m2)

Categorie A                   EUR 3.60 (previously EUR 3.43)

Categorie B                   EUR 2.70 (previously EUR 2.57)

Categorie C                   EUR 1.80 (previously EUR 1.71)

Categorie D usable        EUR 1.80 (previously EUR 1.71)

Categorie D                   EUR 0.90 (previously EUR 0.86)

Minimum Rent pursuant to section 45 MRG (EUR/m2)

Categorie A                    EUR 2.39 (previously EUR 2.27)

Categorie B                    EUR 1.80 (previously EUR 1.71)

Categorie C                    EUR 1.20 (previously EUR 1.14)

Categorie D usable        EUR 1.20 (previously EUR 1.14)

Categorie D                    EUR 0.90 (previously EUR 0.86)

If a value guarantee provision in the lease agreement entitles the lessor to increase the rent, the category rent may be increased as of 1 March 2018. The request for an increase must be made in writing and must be dated and dispatched after the new category amounts come into effect (thus after 1 February 2018); if the letter is dated or dispatched too early it will not have any legal effect. The letter must be received by the lessee no later than 14 days before the requested interest date; otherwise an increase will only take effect as per the next payment term.

Starting 1 March 2018, the minimum rent amounts in accordance with section 45 MRG may also be increased. The lessee must be notified in advance in writing; a value guarantee provision in the lease agreement is not a prerequisite for an adjustment.

At the same time, as of 1 February 2018, the lump sum for administrative expenses in accordance with section 22 MRG will also be increased from EUR 3.43 to EUR 3.60/m² of usable space per year. The resulting blending rate for 2018 is EUR 3.59/m².

Contact

Tibor Fabian, Partner
fabian@bindergroesswang.at

Markus Uitz, Partner
uitz@bindergroesswang.at

Notices: The information provided in this newsletter is general in nature and does not constitute legal advice. BINDER GRÖSSWANG Rechtsanwälte GmbH cannot assume any liability in respect thereof. Before entering in commercial transactions, professional legal advice should be sought.