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Furnished rentals are becoming an increasingly important part of the German housing landscape. Once seen as niche, they are now a critical option for tenants who need flexibility and for landlords seeking viable returns in a tightly regulated market. In a recent episode of the Immocation podcast, host Marco sat down with Arkadi, founder of Wunderflats, and Martin, a tax law professor and political advisor, to explore the role of furnished housing, its demand drivers, and the regulatory uncertainties surrounding it.
What Exactly Is Furnished Housing?
As Arkadi explained, furnished housing is well-established abroad but still relatively young in Germany. Currently, it accounts for just 2–3% of the rental market, though demand suggests the figure should be closer to 5%.
“The main use case is simple,” Arkadi said. “Some people don’t just need walls and a roof — they need a complete home, ready to live in, for a limited period.”
Two-thirds of demand comes from professionals: international hires, project workers in industries such as tech and automotive, guest professors, diplomats, and consultants. The rest comes from life events: families waiting for new builds, people displaced by fire or water damage, or those navigating separations.
For these groups, hotels are too impersonal and expensive, while traditional long-term rentals don’t fit the timeframe. A furnished flat with a kitchen, couch, and space to host friends is, as Arkadi put it, “a real home.”
How Is It Different From Airbnb or Short-Term Lets?
While furnished apartments might sound similar to holiday rentals, the differences are significant. Wunderflats verifies both landlords and properties, and all contracts are based on standard German tenancy law. Importantly, tenants can register their official residence in these homes — a legal requirement in Germany and something short-term holiday rentals usually don’t allow.
This distinction matters for landlords too. Renting to tourists can fall foul of local housing laws, with fines reaching up to €500,000 in Munich. Furnished rentals, by contrast, are legally positioned as residential use, not tourist accommodation.
Is There Enough Supply?
According to Arkadi, demand far outstrips supply: “We could do four times more rentals tomorrow if we had the apartments.”
Some landlords still struggle to attract tenants, but in over 90% of cases, the issue lies in poor presentation, unrealistic pricing, or substandard furniture. The platform dynamics are clear: quality and fair pricing attract tenants, while cutting corners — for example, offering cheap IKEA furniture at triple the usual rent — leaves properties empty.
Where Does Regulation Come In?
The discussion turned to the Mietpreisbremse (rental price brake), designed to cap rents at 10% above the local average. Martin clarified that for furnished, temporary rentals, the rules work differently:
- Short-term, furnished leases (for “temporary use”) generally fall outside the rental cap.
- Unfurnished or long-term leases remain subject to it.
This legal grey zone has led to political debate. Some actors would like to tighten rules on furnished rentals, but as Martin noted, “It’s already well established in constitutional law that landlords are entitled to live off the income from their property. Regulation can’t go so far that it destroys supply.”
The panel also addressed the so-called Möblierungszuschlag (furniture surcharge). There is no fixed calculation, but courts have accepted models where landlords spread furniture costs over seven to ten years, sometimes with a modest return.
The key, both agreed, is fairness: “If you’re charging €500 extra for a €100 electricity bill, that’s exploitation. But recovering the real costs of furniture, service, and risk is reasonable.”
How Long Is “Temporary”?
Most stays on Wunderflats last around six months. Courts generally see anything over a month as legitimate “temporary use,” while contracts stretching beyond 12 months may be treated as standard leases unless tied to specific circumstances (e.g. a 13-month work project).
In practice, disputes are rare. Tenants usually value flexibility, and landlords appreciate predictable turnover. “Out of more than 100,000 cases, it almost never happens that tenants challenge this,” Arkadi said.
Tax and Legal Grey Areas
Two areas stand out for landlords:
- VAT: Rentals of six months or less can trigger a 7% VAT liability, unless the landlord qualifies as a small business under German tax rules. For most private landlords with one to four flats, this threshold is rarely reached, but professional landlords need to plan carefully.
- Commercial status: Offering hotel-like services (cleaning, breakfast, concierge) or operating at scale can shift a landlord into “commercial” classification, with heavier tax and bookkeeping obligations.
Berlin has added further uncertainty, with some districts experimenting with the idea that furnishing an apartment constitutes a “structural change” requiring approval. Both Arkadi and Martin were sceptical: “Calling a sofa a building alteration is a stretch,” Martin said, noting that even the Berlin Senate has publicly contradicted this interpretation.
Why Furnished Rentals Matter
Despite the legal complexity, the bigger picture is clear: furnished housing is not a loophole, it’s a solution. Germany faces a structural housing shortage, particularly in cities. Without flexible rental options, international professionals, families in transition, and others with short-term needs are left without adequate housing.
As Arkadi put it:
“Everyone lives in a furnished apartment. The only question is who pays for the furniture — the tenant, or the landlord. For many people, it makes no sense to buy everything themselves for a few months or years. That’s why this form of housing exists.”
Looking Ahead
Germany doesn’t just need more housing, it needs housing that fits real lives. Furnished rentals are filling that gap: they let tenants arrive with a suitcase, and give landlords a model that rewards both effort and investment. The rules may keep shifting, but the demand isn’t going away.
In a market still short on homes, furnished rentals aren’t a luxury. They’re becoming part of the backbone of how Germany lives and works today.
