How to deal with "unfair rent" laws

Real Estate
30

Will try to answer without delving into whether our unfair rent legislation is good or bad, since that to me seems more of an opinion motivated by politics or greed.

This is simply untrue and the notion of unenforceable or illegal contracts (or clauses) is not unique at all to residential rental contracts.
Off the top of my head: contracts made under duress, old folks tricked/forced out of their legacy, fraudulent contracts, illegal employment clauses, and many other examples can be found. Sometimes the whole contract is invalid and sometimes just specific clauses, like the rent amount in unfair rentals.

Once the possibility of a contract or clause being illegal is established, it’s only logical that it can be disputed and that there are mechanisms to do so.
Saying something along the lines of “if you already signed it, you have to deal with it even if it’s illegal” is a bit naïve since, assuming good faith, it’s in everyone’s interest to keep contracts alive while removing or correcting the illegal parts. Otherwise, it turns a bit into “I only want this contract if it includes the illegal clauses” which is not defensible.

So in essence, disputing a rental contract is simply a mechanism obtain a legal contract, including the price. The fact that it can be disputed after signing recognizes that having a place to live is not optional, many times the same thing is considered for employment contracts.
Interestingly, tenants only get 1 month to dispute rent. After that the price stands, no matter how abusive according to law it is. The first step after a dispute is essentially a negotiation. If that fails, then unfair rent may come into play. If so and if the rent is deemed too high, after adapting to price to something that according to the owner’s documentation will still guarantee them a profit (albeit a lower one) there is no punishment. Other potentially illegal contracts are not reviewed and getting contracts disputed successfully 100s times will yield no consequences for the owner other than time lost (on both sides) and possibly disdain from the public.

Considering this, it seems more like a calculated risk for the owner: unless the contract is under-priced, they are guaranteed a profit no matter what. Even if the initial price was abusive there’s still a huge chance it will stand since very few tenants actually dispute their rent. To be clear, I’m not a proponent of “simply try”, knowingly applying illegal conditions and hope for the best is not morally acceptable IMO.
The rest of the equation is a typical investment scenario: you have known (e.g. laws) and unknown (e.g. evolution of supply/demand) risks and an expected return. Honestly I don’t get all the emotion about it.

Side-note: it seems to me that this is a topic with strong biases at play.

I think this sort of language reduces the value of the exchange. Issuing belittling blanket statements doesn’t make for good discussion. Please don’t take it as an accusation, it is really not meant as one. It is simply an invitation to everyone (myself included) to try to keep discussions focused on what’s relevant :smiling_face:

9 Likes
32

This is accounted for in Art. 270 OR. You can only challenge initial rent in certain circumstances.

1 Like
33

@Fireworks, I give a complete reasoning for why it is factually crazy (hurting yourself and others while not improving your own situation).

But I do prefer focusing on practical possibilities of maximizing legal fair rent vs. discussing morals on which we won’t agree because of vested interest.

34

Now for some quarters this might well be debatable:

Am 1. Juni 2023 standen in der Stadt Zürich 144 Wohnungen leer. Damit war der Leerstand auch dieses Jahr rückläufig. Die Leerwohnungsziffer beträgt nun noch 0,06 Prozent. Auch bei Neubauwohnungen gibt es kaum Leerstände.

35

Everybody please focus on discussing existing regulations and practices and stop passing moral judgements.

I will clean up the thread.

8 Likes
36

I happen to share your opinion that the law is a deterrent to investment

However the rules of the game are what they are and if you are tenant and choose to take the high ground like you suggest you are likely to get screwed over

An 80 year old grandma can be living in a 5 room apartment paying 1000 CHF/m because she has been living there 40 years. She will not move to a smaller apartment because it would mean paying more rent.

The result is that the supply of 5 room apartments is restricted, which increases the price

When such an apartment becomes available many landlords prefer to rent to expats because they are prepared to pay 4000 rent or more and do not know the rules about contesting rent / do not think it is a nice thing to do

So ultimately you can choose to fight windmills , or use the knowledge accordingly and adapt to the laws

2 Likes
37

I know someone who signed a 5 year contract, cancelled their existing lease, then 1 week before the start of the lease the landlord refused to hand over the keys unless they agree to sign a shorter contract.

The shorter contract was signed under duress.

38

I’m pretty sure calling the police, would have helped. As soon as a rental contract starts, you need to be able to access the apartment. This sounds like extorsion.

1 Like
39

Legal advice was that the shorter contract would be deemed invalid by a court if landlord tried to enforce it. The 5 year contract would be binding

1 Like