Seeking Advice on Negotiating Rent Increase & Unusual Clause

Hi Mustachians,

I’m looking for advice on how to negotiate a rent increase and an unusual clause in my rental contract. I recently signed a lease for an apartment in Zurich Switzerland, and I’ve noticed a significant rent increase compared to the previous tenant.

  • Rent Increase: The rent (excluding Nebenkosten) has jumped 27%, from approx. CHF 1,600 (paid by the previous tenant, effective November 2022) to CHF 2,000 for my contract. No renovations have been done, except painting the ceiling before the handover, and I’m struggling to see the justification for such a sharp increase. Nebenkosten is unchanged between the previous tenant and my contract (CHF 250/month).
  • Unusual Clause: The contract states that I cannot request a rent reduction due to future construction in a neighboring building (planned for 2026). I find this quite odd and would like to understand if this is legally enforceable.

From my research, Swiss law allows rent increases based on factors like reference interest rate changes, inflation, and value-enhancing renovations. However:

  • Mortgage rates have fluctuated but generally decreased since mid-2023. This downward trend has continued into 2024, with rates decreasing over the past year and a half.
  • Inflation has stabilized around 1.0-1.5% since mid-2024. By November 2024, the inflation rate was at 0.7%, well below the Swiss National Bank’s target range of 0-2%.
  • The reference interest rate rose to 1.75% in 2023 but has not increased further.
  • The SNB policy rate has been reduced multiple times in 2024, currently at 0.5% following the reduction in December 2024.

Given these conditions, I suspect the increase is not fully justified. I am considering proposing a recalculated rent increase of 1.5-2% max, resulting in a rent of ~CHF 1,830-1,835 (including Nebenkosten).

I’d love to hear from others who have successfully negotiated rent adjustments in Switzerland.

  1. Has anyone dealt with a similar situation?
  2. Is this construction-related clause enforceable?
  3. Any tips on structuring my request to the agency in a way that maximizes my chances of success?
  4. Will I risk the agency terminating my contract or other retribution?

Thanks in advance for your insights!

Just to be sure . You signed a rent agreement at the advertised price and now want to get rent reduction. Your rationale is not that based on mortgage reference rate or inflation but is based on „unfair rent“

It seems a bit weird to me and looks like you are not honouring an agreement you just signed

Anyhow, few things to consider

  • what’s the rental yield of the property based on current rent
  • How does your rent compares to the the other apartments (similar dimensions) in the same building or neighbourhood
  • You also need to think about if 1600 CHF was below market price or not
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Contact Mieterverband, tho if you’re not already a member you’ll have to pay (also the window for contesting the rent in your contract is likely small, so need to move fast).

From what I understand there’s some guidelines based on rent of similar places in the neighborhood and there’s precedent for overturning a rent increase.

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Not every contract follows the rules, you can definitely contest part of it.

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I understand . I am only talking about rent which is a clear number.

It’s also true of the rent amount, it might not have followed the rules for rent increases.

There are regulations for rent prices, it’s not a free market. Of course one could discuss whether this is unfair or not for owners, but thats a different discussion.

On current state, you can check for unfair rent increase after signing (contact Mietverband), no matter what you signed in the original contract. IMO, this especially makes sense in overheated places such as ZH, where you couldn’t just chose another flat (because it took you 2 years to get a contract at all).

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Interesting. No wonder why landlords are so picky

You can contest and win, but don’t be surprised if at the end of the year you are kicked out and the landlord tries again with a more compliant tenant.

I think once the lease is established, the grounds on which landlord can terminate are not that many. So as long as OP pays the rent , it’s tough for landlord

You might actually be more protected from being kicked out, as it would always come up that this is unlawful revenge from the landlord for a lawful behavior of the tenant.

But there is a simple solution for the landlord:

Just stay within the law and check whether your rent increase is legal or not before you let someone sign it.

Don’t tell me anyone doing a 25% rent increase is not aware that it might be too much. Most will just hope that the tenant will be silent and take the risk that it might not work in the end. But we don’t have to feel bad for the landlord if his unlawful rent increase doesnt go through.

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You can be quite confident that this would not have success for min. 3 years. See info from Mietverband below:

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I think most landlords are aware of what they’re doing, they just hope nobody will contest it but I’ve never heard of retaliation after a tenant exercises their rights.

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Do not try to negotiate the rent reduction yourself. The law allows you to challenge the initial rent within 30 days of receiving the apartment keys. After that, you can no longer take action regarding the initial rent. Your only option is to contest the rent before the conciliation authority.

According to case law, an increase of more than 10% is presumed abusive, but this is only a presumption — the landlord can provide evidence that the increase is justified. However, I doubt this would be the case here if the previous lease was signed in November 2022 and no renovations have been made.

Regarding a rent reduction due to construction work, you cannot take action unless the work lasts longer than initially announced.

As mentioned earlier, contact a tenants’ association or a lawyer specializing in rental law for assistance with the procedure.

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Thank you for your input!

I went to the tenant association, who recommended that I try conversing directly with the agency before sending the letter they wrote for me to the arbitration authority (Schlichtungsbehörde). So quite the opposite from your suggestion. I would love to hear more about why you recommend going directly to the Schlichtungsbehörde!

I will leave out anything connected to the construction work - thank you for the advice!

The problem with the Schlichtungsbehörde is that the landlord doesn’t have to turn up. Then you have to take it further, and at that point, you need legal advice/support. The Schlichtungsbehörde is definitely an important option (use it if necessary!), but it should be the last one.

Well there is a difference between conversing with them vs. negotiating. Sure it makes sense to let them know about your issue first, but if (or more likely “when”) they don’t wanna give in, it doesn’t make sense to waste time of further arguing with them directly.

You’ll find lots of useful documents for that first step directly from the Mietverband.

Also, if you waste time doing that and the 30 days pass by, you can’t dispute it anymore with the Schlichtungsbehörde if I read that correctly.