Does the Corona virus affect the Rentals of Furnished Flats in Berlin?
Von Christine Kandler
Renting out a furnished Apartment in times of Corvid 19 - Update February 2021
Is there still demand for furnished flats during the second Corona lockdown?
Yes, Crocodilian is still receiving applications from startups in Berlin who are hiring new staff even during the lockdown. Tenants who are already living in a temporary flat are renewing their leases. Nevertheless, the supply is greater than the demand.
Which flats are still easy to rent out?
Well-equipped flats with modern furniture in central locations in the medium price segment are still in demand. In times of crisis landlords who have not relied on the minimum standard, should not worry too much..
Which flats are difficult to rent at the moment (as of February 2021)?
At the moment there is less demand for large flats and flats in the luxury segment. There are no films being shot at the moment and fewer employees are being temporarily transferred to Berlin. Flats in the 1500 euro plus price segment are not having an easy time during the lockdown.
What changes did the Corona crises bring?
The furnishing, the feel-good factor, sufficient space, and a place to work are very important for tenants when working from home. When choosing a flat, tenants now attach even more importance to:
- A desk, in addition to the dining table. A writing desk should be available even in the smallest apartment.
- fast internet: If you still have an old contract, you can upgrade it.
- Tenants who enter Germany and have to stay in quarantine for 14 days ask for flats with sufficiently large refrigerators with freezers.
- A well-equipped kitchen
What can landlords do to improve the rent-ability of their flat now?
- Upgrade the flat - desk, faster internet, etc., or, if necessary, renovate now.
- Reduce the rent for the next few months and then not rent for a longer period straight away.
Are there or have there been cancellations because of Corona?
Fair play is our motto. A possible entry or exit ban etc. should not be to the detriment of the landlords. Therefore, we tell tenants straight away that a temporary tenancy agreement cannot be canceled and that is it not advisable to rent for weeks or months in advance. Tenants now wait until they have arrived in Berlin or until they know for sure that they will come to Berlin. That's why we haven't had any requests for cancellation.
Viewings in times of Corona: New service from Crocodilian
Flat viewings are a problem at the moment. Especially when the flat is still occupied. But viewings are also time-consuming during normal times. That is why we offer a new service. For all new apartments, we now create virtual tours. The tenant can view your flat from the couch and get an accurate picture of your flat.
update July 8,2020
Meanwhile employees of large companies are coming to Berlin again and there are again many inquiries. But still less than before Corona. As a landlord, you should rent out as soon as possible, e.g. do not sign a contract at the beginning of July for September. Unfortunately, it still happens that tenants are not allowed to leave the country and therefore cannot come to Berlin.
At the moment we are finding that most tenants are looking for an apartment close to their place of work. Many are even looking exclusively within walking distance. Long journeys by public transport are currently not very popular.
Therefore, we are urgently looking for apartments in Potsdam and Babelsberg at the moment, as film productions are looking for accommodation for their employees.
May 2020
The Corona crisis also affects the letting of furnished temporary apartments. We at Crocodilian are currently also on short time, partly in the office and partly from home. Nevertheless, we are of course available for you. The best thing to do is to send us a mail and we will get back to you.
We have not completely run out of work. Almost all tenants who rented a furnished apartment before the beginning of the crisis are now extending their rental contract. Nobody can or wants to move at the moment. The problem is, of course, the new rentals. At the moment, not even people who have already signed an employment contract with a Berlin start-up can leave their home country - and enter Germany. The main target group of temporary furnished accommodation, namely tenants from abroad who move to Berlin because of the job, is thus no longer included. German clients don’t come to Berlin either, nor do tenants from the field of art and culture. The theatres have closed and all film projects have been suspended.
Is there any demand at all for temporary furnished apartments in times of Corona?
There are still some requests for temporary furnished apartments. Mainly from tenants who are already in Berlin and who have already rented here for a limited period. There are also already inquiries for July or August. The relatively few rental inquiries are currently matched by a large supply.
The relatively few inquiries are currently matched by a larger offer. Many holiday apartments and Airbnb accommodations can no longer be rented to tourists and short-term tenants and are now also offered furnished on a temporary basis.
Do temporary landlords have to expect a loss of rent during the Corona crisis?
So far all Crocodilian tenants have paid their rent. We always check tenants very carefully and we do not expect tenants to default in the near future. The majority of our tenants are IT employees of large companies. At the moment they are working in their home offices, and not on short-time work.
Is it likely that temporary tenants will terminate their lease prematurely?
Tenants who have a permanent, unlimited employment contract do not usually terminate their lease early. Not even in times of Corona. They still have a job, are financially secure, and cannot leave their home country at the moment anyway.
What should landlords look out for in times of Corona?
When making inquiries in the future, a distinction must be made between inquiries from prospective tenants who are already on-site and those who have to arrive first. Of course, we hope, like everyone else, that the pandemic will die down, that the borders will be opened again and that prospective tenants will be able to leave and enter Germany again. However, at the moment it is not yet clear how the situation will develop. For this reason, these factors should always be taken into account when renting a furnished apartment on a temporary basis. In the worst case, a tenant will sign a rental contract and then not travel to Germany. Even if the deposit and rent have already been transferred in advance, this is an unsatisfactory situation.
What can temporary landlords do during the Corona crisis?
Should landlords reduce the rent for their furnished apartments now? If you have been offering your apartment at an ambitious rent or if it is currently vacant and you want to rent it out as soon as possible, a price reduction would certainly be an option. After all, vacancy is of course more expensive than renting at a lower price. Cheap apartments are always in demand. Even now. It will be more difficult - but not impossible - for luxury apartments in the higher price segment, even if you lower the price. At the moment we are dealing with demand - and not a price crisis. Even if you rent cheaply now, you should remember that it is difficult to increase the rent by a larger amount if the tenant should rent for a longer period of time.
Should landlords conduct viewings for furnished apartments during Corona?
If your apartment is vacant at the moment, you can, of course, make specific viewing appointments - with all precautions taken. It is of course easier if the tenant rents the apartment without prior inspection.
Are there other uses for temporary furnished apartments during Corona?
craft-beer pubs now sell beer across the street, cinema operators organize drive-in cinema shows. Many industries are now getting creative and finding ways to continue their business. What about temporary living? There are different concepts here as well. Some agencies have tried to offer corona apartments. Either as home offices or as quarantine apartments. All at a reduced price.But unfortunately, that doesn't work. Renting out living space as office space is misappropriation and illegal. Furthermore, there is no target group for furnished apartments used as offices. Even if the apartment is equipped with a desk. The apartments would also be too expensive, even at a reduced rent. Quarantine flats were also not in demand.
Temporary furnished apartments can only be rented out for residential purposes. Therefore, there is no other option at the moment than perhaps price reduction or waiting for the end of the pandemic.
What do landlords have to consider now when viewing, handing over, or changing tenants?
Please keep the minimum distance and wear a face mask. After a tenant has moved out, you must clean and disinfect your apartment with special care if the next tenant moves in less than nine days. The coronavirus survives for a maximum of nine days on surfaces such as door handles etc.
How will the market for temporary furnished accommodation develop after Corona?
Nobody knows how quickly the economy will recover after the Corona crisis. The big start-ups developing digital business models are less affected by the crisis than restaurants, retail, or culture. Experience shows that after a crisis there will also be a recovery at some point. Many companies would like to continue working in the home office even after the pandemic has subsided. If this were to prevail, apartments with fast internet, a study or at least a desk would be in particular demand in the future.
Until then, we at Crocodilian will of course do everything we can to find a good and solvent tenant for your temporary furnished apartment as quickly as possible.
Stay safe!
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