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Property management fees are not recoverable in German residential leases
Verwaltungskosten, bookkeeping and preparing the statement are excluded by law. How to find them and how to object.
Of all the items that do not belong on a German residential service-charge statement, property management is the most common. Sometimes it appears openly as "Verwaltungskosten"; more often it hides inside a collective item or inside the caretaker's pay. For residential tenancies the legal position is clear. This guide shows how to find the amount, how to object, and where the limits are. It covers residential tenancies in Germany and is not individual legal advice.
What the law says
Section 1(2) no. 1 BetrKV expressly removes management costs from the definition of operating costs. It names the costs of the staff and facilities required to manage the building, the costs of supervision, the value of management work performed personally by the owner, the costs of statutory or voluntary audits of the annual accounts, and the costs of running the business.
Section 556(1) BGB permits allocation only for operating costs. Anything that is not an operating cost therefore cannot validly be agreed either; section 556(5) BGB makes deviating agreements to the tenant's disadvantage void.
The leading case
The Federal Court of Justice confirmed this in 2018. A management-cost lump sum shown separately in a standard-form residential lease is an agreement deviating from section 556(1) BGB to the tenant's disadvantage and therefore void, unless the lease makes clear that the lump sum forms part of the basic rent (BGH, judgment of 19 December 2018 – VIII ZR 254/17). The voidness rule now sits in section 556(5) BGB; it was in subsection 4 when the case was decided.
In practice this means that even an express clause in the lease does not save the charge if the lump sum appears as a separate item next to the net rent. Commercial tenancies are treated differently; there wider agreements are possible.
Where management costs hide
The most obvious form is a line called "Verwaltung", "Hausverwaltung" or "Verwaltergebühr". The hidden form is more common. Watch for: "Abrechnungserstellung", "Abrechnungsservice", "Buchhaltung", "Kontoführung", "Bürokosten", "Porto und Telefon", "Mahngebühren", "Objektbetreuung", "kaufmännische Betreuung", "Verwaltungspauschale".
The caretaker line often contains administrative work too. Section 2 no. 14 BetrKV allows the caretaker's pay to be charged only in so far as it does not concern property management. If the caretaker handles flat handovers, obtains quotes or checks invoices, that share must come out.
The metering exception
One important exception concerns heating. Section 2 no. 4(a) BetrKV expressly includes the costs of using consumption-metering equipment including calculation and allocation. The metering company's invoice for preparing the heating statement is therefore recoverable.
This applies only to the heating and hot-water statement. Preparing the rest of the service-charge statement remains management work. Where one provider does both and charges a single sum, a split is required.
How much is at stake
Management is often charged per flat per month, in many contracts between twenty and thirty euros. Over a year that is several hundred euros — enough to make checking worthwhile.
A frequent source is a condominium (Wohnungseigentümergemeinschaft, WEG). The manager bills the owners; if an owner lets the flat, that share may not be passed on to the tenant. The WEG statement is often handed on unchanged although it contains items that are not recoverable in a tenancy: the manager's fee, the maintenance reserve, bank charges.
It is not the same as the rent
Management costs may not be billed alongside the rent — but of course every landlord finances administration out of rental income, just as any business finances its accounting out of turnover. The dispute is not about whether you contribute to administration, but about whether it may be charged in addition to the agreed rent.
That distinction also matters practically. If a management lump sum falls away, the landlord does not thereby acquire a right to raise the basic rent by the same amount. A rent increase follows its own rules, requirements and deadlines. Keep the two matters apart.
How to object
Be specific. Name the billing period, the item, the amount and the reason: "The item 'Verwaltungskosten' of €288.00 is not a recoverable operating cost under section 1(2) no. 1 BetrKV. I ask for a corrected statement." Ask at the same time for inspection of the documents if you suspect further management elements in other items.
Where an item is mixed, only the inadmissible part is removed. So ask for the breakdown before you name a figure.
The deadline
Objections must generally be notified within twelve months of receipt of the statement, section 556(3) BGB. Note the date the statement reached you and diary the deadline. A phone call is hard to prove later; a written notice with evidence of delivery is the safe route.
Amounts already paid
If you have paid an inadmissible item in the past, a reclaim may be possible. How far back you can go depends on limitation, the objection deadline and the circumstances. The standard limitation period is three years, running from the end of the year in which the claim arose. Do not assume you can go back indefinitely, and take advice for larger sums.
When the manager pushes back
A common answer is that management costs "have always been billed this way". Long practice does not change the statutory position. Another is that the item is agreed in the lease; after the decision cited above, that generally does not carry in residential tenancies either.
Stay factual and ask for reasoning that refers to the operating-costs ordinance. If none comes, a tenants' association (Mieterverein) or a lawyer is the next step.
Read on and check your own bill
For the other classic mistakes, see repairs and maintenance and the overview of non-recoverable service charges. For obtaining the documents, see inspecting the invoices.
To see whether your statement contains management costs, upload it to the free check. Hidden descriptions are recognised too and mapped to the provision they offend.