Rent increase or reduction – understanding and enforcing your rights as a tenant

Landlords may only increase the rent under certain conditions. The most common and legally permissible reasons are:

• Increase in the reference interest rate: The reference interest rate is set quarterly by the Federal Office for Housing (FOH). If this rate increases, the rent can be adjusted proportionately.
• General inflation: Landlords are allowed to pass on up to 40% of the inflation rate to the rent. This rate is based on the development of the Swiss consumer price indexes.
• Rising costs: Higher operating or maintenance costs may justify a rent increase, provided they are substantiated.
• Value-enhancing investments: After renovations or modifications that increase residential value, pro rata costs may be added to the rent.
• Local and neighborhood customary rates: If the rent is significantly lower than for comparable properties in the area, it may be adjusted – but only with proof of at least five comparable properties.

The increase must be proportionate and objectively justified. There is no fixed upper limit in Swiss Francs – but there are legal guidelines:

• Reference interest rate: An increase of 0.25% in the reference interest rate corresponds to around 3% on the net rent.
• Cost-of-living adjustments: A maximum of 40% of the inflation rate may be passed on.
• Cost increases and investments: Only the actual, proportionately allocated additional expenses may be included in the calculation.
• Comparable rents: Must be objectively justifiable (similar location, size, fixtures and fittings, etc.).

Clear formal rules must be observed for a rent increase to be valid:

• Official form: The notification must be made on the official form of the respective canton.
• Timely delivery: The notification must be received no later than 10 days before the start of the notice period.
• Obligation to provide reasons: The increase must be comprehensible and fully justified – including specific information on the interest rate, inflation or investments.

If you have received notice of a rent increase, you should take the following steps:

1. Note the deadline: You can contest the increase with the arbitration authority within 30 days of receiving the notification.
2. Check the increase (or have it checked): Assess the justification – or have it checked by experts.
3. Legal protection to clarify the claims legally.
4. Strive for an amicable solution: Mediation with the support of an arbitration authority can often help.

Tip: You can use the Tenants' Association's rent calculator to check a rent increase yourself.

A reduction in the rent can be applied for under the following conditions:

• Reduction in the reference interest rate: If the reference interest rate falls, you have the right to a corresponding rent reduction.
• Defects in the apartment: Mold, noise pollution, defective heating or other impairments can justify a rent reduction.
• Discontinuation of benefits: If, for example, the elevator is shut down or a cellar room becomes unusable, you are entitled to a reduction.
• Excessive initial rent: For new tenants, the rent can be reviewed within 30 days of moving in and reduced if necessary.

Tip: Check your entitlement to a rent reduction with the Tenants' Association.

1. Write up a justification for the rent reduction and notify the landlord in writing
2. Set a deadline for rectification
3. If it is rejected: get the arbitration authority involved
4. Include Orion legal protection insurance

Whether it's a rent increase or a rent reduction, legal disputes with landlords are often accompanied by uncertainty. With Orion legal protection insurance, you are comprehensively covered:

• Report your legal case online – around the clock.
• Independent legal counsel will carefully examine your situation, provide you with in-depth information and discuss the next steps with you.