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Landlords in Ansbach face a strategic decision when signing new leases in 2026: index-linked rent under Section 557b of the German Civil Code (BGB) or graduated rent under Section 557a of the BGB. This choice has long-term implications for rental income-especially following the years of high inflation from 2021 to 2023, the differences between the two models are very clear. Landlords in this university town, home to the University of Applied Management, need clear answers.
Both rental models are regulated by the German Civil Code and designed as alternatives to free comparative rent increases. They can only be agreed upon for new leases or by mutual agreement to amend an existing contract-a subsequent unilateral change is not possible.
Staggered Rent Increase (§ 557a BGB): The landlord and tenant contractually specify the amount or percentage by which the rent will increase at specific times. The increases must be clearly specified in terms of amount or percentage; the intervals must be at least twelve months. During the term of the graduated rent, no further rent increases (e.g., based on comparable rent) are permitted. Advantage: maximum planning security for both parties.
Index-linked rent (Section 557b BGB): The net base rent is linked to the Consumer Price Index for Germany (CPI) published by the Federal Statistical Office. Each year, the landlord may adjust the rent in line with changes in the CPI. Unlike with graduated rent, the amount of future adjustments is unknown-it follows actual inflation. Here, too, no increase based on comparative rent may occur during the index-linked rent period.
A key difference: The cap under § 558 BGB, which limits rent increases based on comparable rents to 20 percent over three years (15 percent in areas with a tight housing market), does not apply to index-linked lease agreements. The rent can theoretically rise indefinitely-and in practice also drop significantly if inflation turns negative.
The following table shows how a sample apartment in Ansbach (70 m², renovated older building, net base rent in 2020: €7.00/m²) would have performed under three scenarios.
| Year | Local comparative rent (€/m²) | Graduated rent +3%/year (€/m²) | CPI-linked index rent (€/m²) | CPI change from previous year |
|---|---|---|---|---|
| 2020 | 7.00 | 7.00 | 7.00 | - |
| 2021 | 7.15 | 7.21 | 7.22 | +3.1% |
| 2022 | 7.30 | 7.43 | 7.87 | +9.0% (energy crisis) |
| 2023 | 7.50 | 7.65 | 8.73 | +10.8% (cumulative) |
| 2024 | 7.65 | 7.88 | 9.10 | +4.3% |
| 2025 | 7.80 | 8.12 | 9.42 | +3.5% |
| 2026 | 8.00 | 8.36 | 9.56 | +1.5% |
Source: Federal Statistical Office CPI annual figures 2020-2025, 2026 forecast by the Bundesbank. Ansbach comparative rents: Ansbach rent index / Ansbach Expert Committee, as of Q1 2026. Author’s own model calculation.
The result is clear: During the high-inflation phase of 2022-2023, the index-linked rent far exceeded the graduated rent. By the end of 2026, the index-linked rent will be around 14 percent higher than the graduated rent and as much as 20 percent higher than the local comparative rent, which is capped by the rent cap.
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Index-linked rent protects landlords particularly effectively during periods of rising inflation. Because it has no cap, it can rise disproportionately if inflation continues to rise. Furthermore, there is no need for regular negotiations regarding comparable rents: the adjustment occurs automatically as soon as the landlord submits a written adjustment notice with the CPI figures.
Index-linked rent is particularly suitable for:
Index-linked rent becomes disadvantageous if inflation remains persistently low or even trends toward deflation. In this case, rents rise barely or not at all-the graduated rent with a 3 percent fixed increase would then be more advantageous.
A stepped rent offers maximum transparency and is particularly attractive to tenants: they know from the start how much their rent will be in the coming years. For landlords, this provides a competitive advantage in tenant selection-reliable, long-term tenants value predictability.
A graduated rent is particularly sensible when:
For Ansbach landlords renting to students at the University of Applied Management, graduated rent can be attractive: student shared apartments have short lease terms, and graduated rent offers more flexibility here than an index-linked rent, which only takes effect after one year.
Ansbach differs from the core cities of Nuremberg and Fürth in one crucial respect: there is no legally binding rent index that systematically restricts landlords when it comes to comparative rent increases. This means that while landlords must adhere to the 20-percent cap for standard comparative rent increases, they are less bound by a tightly regulated rent index.
This makes the choice between index-linked and graduated rent in Ansbach more strategic than in Nuremberg: Those who opt for comparative rent can act more flexibly in Ansbach-those who want planning security over many years are better served by index-linked rent. According to the Ansbach Appraisal Committee, purchase prices for multi-family homes in Ansbach in 2025 averaged between €1,650 and €2,100 per square meter of living space-a level that makes yield considerations particularly relevant.
When concluding an index-linked or graduated rent lease agreement, certain formal minimum requirements apply. The agreement must be concluded in writing. For index-linked rent, the starting index (current CPI at the time of signing) must be recorded. The Federal Statistical Office publishes the CPI monthly; for May 2026, it stands at around 133.8 (base year 2020 = 100). For graduated rent, all graduated levels must be fully specified in the contract with dates and amounts.
Both types of contracts exclude ordinary rent increases based on comparable rents for the duration of the term. Other adjustments-e.g., following modernization measures-are also possible during the term and lock-in period, provided the legal requirements (§ 559 BGB) are met.
A common mistake with index-linked rent: Landlords forget the annual adjustment notice or draft it informally. The increase notice must be in writing and must include the new CPI value, the base value, and the calculated percentage. Without this formally correct notice, the increase is provisionally invalid-the tenant may refuse to pay. This error can be permanently avoided with a simple standardized letter that is updated annually using the current value from the Federal Statistical Office.
Neither index-linked rent nor graduated rent is without risk. With index-linked rent, the tenant bears the inflation risk when prices rise sharply-which can lead to financial strain during periods of high inflation and, in extreme cases, jeopardize the tenant’s ability to pay. Landlords should carefully check their tenants’ creditworthiness when entering into index-linked lease agreements.
With graduated rent, the risk lies with the landlord: if the agreed-upon increase is below actual inflation, the landlord loses purchasing power. Furthermore, graduated rent is not legally guaranteed by a minimum rate of increase-tenants may accept even a 1 percent increase, which in the long term amounts to a real rent reduction.
For Ansbach landlords with a mixed portfolio-e.g., apartments built in different years and with varying levels of amenities-a differentiated strategy is recommended: high-quality new-construction apartments with index-linked rent, and simpler older apartments with graduated rent, if the initial situation requires greater predictability.
The choice of rental model is not only a question of rent level but also influences the gross and net rental yield and thus the property’s valuation in the event of a resale.
For a multi-family home in Ansbach with a purchase price of €1,850,000 and six residential units of 70 m² each, the difference is clear:
| Model | Annual net base rent 2026 | Gross rental yield | Growth through 2031 (2% inflation forecast) |
|---|---|---|---|
| Local comparative rent (€8.00/m²) | €40,320 | 2.18% | 2.26% (rent cap mitigated) |
| Graduated rent +3%/year (€8.36/m²) | €42,134 | 2.28% | 2.64% (in 5 years) |
| CPI-indexed rent (€9.56/m²) | €48,182 | 2.60% | 2.86% (at 2% inflation/year) |
Proprietary model calculation based on a purchase price of €1,850,000, 6 × 70 m² living space. Net base rent in 2026 according to the table above.
The result makes it clear: Even with moderate inflation (2% p.a.), the index-linked rent is approximately 0.3 percentage points higher than the graduated rent in terms of gross rental yield after five years. Upon resale, this yield difference is directly factored into the purchase price using the income approach-with a capitalization rate of 22, the yield advantage of the index-linked rent alone results in an estimated added value of approximately €85,000 on the transaction price.
For landlords in Ansbach who plan to sell in five to ten years, the index-linked rent is thus not only a source of ongoing income but also a strategy for increasing value at the exit point.
Rental income is taxable as income from renting and leasing (Section 21 of the German Income Tax Act) - whether it is indexed rent or graded rent is initially irrelevant. However, there is a key difference: With indexed rent, rental income can rise significantly faster than expected during years of high inflation. This not only increases the total taxable amount but, when combined with other income, can raise the tax rate. Landlords who implemented index-linked rent increases of 8-10 percent in 2022-2023 should check whether their advance tax payments were still realistic.
The graduated rent system offers planning security here: Since the increases are known in advance, tax prepayments can be adjusted precisely. The tax office accepts forward-looking adjustment requests if the future graduated rates are specifically quantified in the lease agreement.
For landlords in Ansbach who hold their properties through an investment GmbH or GbR, special corporate or income tax rules apply regarding the separation of rent adjustments and operating income. Tax advice during the annual financial closing is recommended.
The experience of the high-inflation years 2021-2023 clearly shows: Index-linked rent protects landlords significantly better in turbulent times than a fixed graduated rent. Those who agreed to CPI indexation in 2020 will be approximately 14 percent above the graduated rent result in 2026. For new leases in Ansbach in 2026, there are many arguments in favor of index-linked rent-especially if the lease term is five years or longer.
Before signing a lease, it’s worth getting a current appraisal of your property: The valuation tool from leadmarkt.ch determines the market value and shows which rental segment your Ansbach apartment falls into-an important basis for choosing the right rental model.
Prepared by the my-home.de editorial team in collaboration with regional real estate analysts. Data as of May 2026.
An index-linked rent ties the rent amount to the Consumer Price Index (CPI) and adjusts the rent annually in line with actual inflation. A graduated rent agreement sets fixed increase amounts or percentages in advance for several years, regardless of actual inflation trends.
No. The cap set forth in Section 558 of the German Civil Code (BGB) (a maximum increase of 20% over three years) applies exclusively to rent increases based on comparable rents. Index-linked lease agreements under Section 557b of the German Civil Code (BGB) are exempt from this cap-even in areas with a tight housing market.
A change to the rental model is only possible with the tenant's consent and through a new written lease agreement. The model cannot be changed unilaterally under the current tiered lease agreement.
The index-linked rent may be increased no more than once a year and no sooner than one year after the last adjustment. The landlord must give written notice of the increase and specify the current CPI figure as well as the base figure.
For long-term leases (over 5 years), index-linked rent has performed significantly better during periods of high inflation, such as 2021-2023. It allows for automatic adjustments without negotiation. Step-rate rent is more predictable but inflexible-those who agreed to a 3% step rate in 2020 fell well short of the CPI during the years of high inflation.
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Content researched and verified by the my-home.de expert network - specialized in real estate sales, valuation, and market analysis in Nuremberg, Fürth, Erlangen, Schwabach, and Roth.
Note on content
This guide article serves as general information about the real estate market in Nuremberg and the surrounding region. It does not replace individual tax advice, legal advice, or expert valuation in specific cases. For binding information, please contact a tax advisor, attorney, or certified appraiser.
Market data, prices, and statutory provisions may change at short notice. Despite careful research, we assume no liability for the accuracy, completeness, or timeliness of the content.
Article as of May 30, 2026
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