Over the past few years, Berlin has become one of Germany's largest markets for furnished housing. International professionals starting a one- or two-year stint at a Berlin company, students on an exchange semester, commuters with a second home in the city – they're all looking for a flat they can move into with essentially just a suitcase. For property owners, this opens up an interesting option: renting furnished instead of committing to a standard open-ended lease or leaving the flat vacant for a while. This model, however, follows its own rules, which differ from standard residential letting in some important respects.
Who actually benefits from furnished letting
Not every owner automatically benefits just because interim leasing is currently a hot topic. The model tends to make sense in specific life situations.
- Owners who are already planning a sale but don't yet know exactly when often bridge the gap better with a furnished, fixed-term lease than with a standard open-ended tenancy agreement.
- Anyone moving abroad for work for a year or two, who doesn't want to sell their own flat, will find that a fixed-term furnished lease offers a solution that lines up with their planned return.
- Heirs who have inherited a flat and haven't yet decided whether to move in themselves, sell, or let it long-term gain valuable time with an interim lease, without a long-term commitment.
Owners who simply want steady, predictable income from a property they hold are usually better off with a standard open-ended lease. Furnished letting means more work: buying and maintaining furniture, more frequent handovers, more wear and tear, and more frequent advertising for new tenants. The surcharge you're allowed to charge doesn't always fully make up for this extra effort.
Interim leases from a legal perspective
The term "interim lease" (Zwischenmiete) is often used loosely. Legally, it refers either to subletting by a primary tenant who is themselves temporarily absent from the flat, or to a direct fixed-term lease granted by the owner. Both variants carry their own pitfalls.
If a primary tenant sublets, they generally need their landlord's permission under Section 540 BGB (German Civil Code). Without this consent, they risk termination of their own tenancy. If the owner lets the property directly on a fixed-term basis, the more interesting question arises: when is a fixed term actually valid? Under Section 575 BGB, a fixed-term lease requires a specific reason stated in the contract – for example, Eigenbedarf (the owner's own need for the property) tied to a set date, planned demolition, or major renovation. Without this reason, the contract is treated as open-ended despite the agreed end date, giving the tenant full protection against termination.
The furniture surcharge: how much is allowed
The furniture surcharge (Möblierungszuschlag) is the amount landlords add on top of the base rent (Kaltmiete) for the use of furniture, kitchen equipment, and fittings. It's generally permissible, but can't be set arbitrarily high. Berlin's rent index (Mietspiegel) doesn't include a standard table for this. Courts instead often apply a depreciation-based approach: dividing the value of the furniture by an estimated useful life, usually somewhere between eight and twelve years, and calculating a monthly amount from that. Some courts also accept a small additional return on the capital invested.
Importantly, the rent control cap (Mietpreisbremse) also applies to furnished flats, provided the flat isn't just being let for temporary use but is intended for permanent occupancy. Landlords who inflate the surcharge significantly to get around the permissible comparative rent risk tenant claims for repayment, sometimes going back years. A reasonable, well-documented surcharge – ideally with a short breakdown of the furnishings included – protects against exactly this kind of dispute and makes the calculation solid if challenged.
Where the line to commercial letting is drawn
Furnished letting on a fixed term is not the same as short-term tourist rentals, even though the line can blur in practice. Berlin has its own regulatory framework for this – the Zweckentfremdungsverbot (ban on diverting housing from residential use) – which directly addresses this area. Anyone repeatedly letting a flat to a rotating cast of guests who stay only a few days or weeks and don't establish the flat as their genuine centre of life quickly moves into the territory of holiday-let use requiring a permit. The district authorities (Bezirksämter) do check for this, and operating without the required permit can result in fines.
Furnished letting to people who are genuinely living and working in Berlin for a few months – the classic expat case – generally doesn't fall under this rule, as long as a standard tenancy agreement is in place and no hotel-like extra services, such as daily room cleaning or reception, are offered. The tax authorities draw a similar line: straightforward letting with occasional tenant turnover remains rental income under Section 21 EStG (Income Tax Act). But if regular additional services, very frequent turnover, and a booking-platform-style structure are added into the mix, the activity can be reclassified as a commercial enterprise – triggering trade tax liability (Gewerbesteuer) and other VAT consequences. Anyone planning larger volumes, wanting to let several furnished units, or unsure how their particular setup should be classified should clarify this in advance with a tax advisor and, if in doubt, with the relevant district authority.
Furnished letting can be a sensible interim solution for owners in Berlin, particularly when a sale, a posting abroad, or a decision on future use is still pending. If you're unsure whether this model makes sense for your property, or whether a sale might be the better option, our Services page gives an overview of our advisory support. At L&B Immobiliya, we've been supporting property owners across Germany since 2009, in German, English, and Russian. Simply get in touch via our contact page – we're happy to take a no-obligation look at your situation.
