Fixed-term lease: when a temporary rental agreement is valid

EverReal Editorial Team. The same letting technology chosen by 450+ real estate companies. Last updated: October 2026.

Problem: A fixed-term tenancy agreement for two years, simply agreed upon without further details, is not legally valid. Cause: The law permits a fixed term only for three specific reasons, and the landlord must state the reason in writing upon conclusion of the contract. Proposition: If it is missing, the tenancy is deemed to have been entered into for an indefinite period, and termination requires a legitimate interest.

When is a fixed-term tenancy agreement effective?

A fixed-term tenancy agreement (Zeitmietvertrag) is only validly limited in time if the landlord states one of three statutory reasons in writing upon conclusion of the contract: use as living space for themselves, family members, or members of their household; permissible demolition, substantial alteration, or renovation of the premises, where continuation of the tenancy would significantly impede this; or letting to a person obligated to provide services. If the reason is missing, the tenancy is deemed indefinite.

The three statutory reasons for a fixed-term tenancy agreement

A fixed-term tenancy agreement for residential space is governed by Section 575 BGB. Subsection 1 permits a fixed term only if you pursue one of three purposes after the expiry of the rental period:

• Own use. You want to use the premises as a home for yourself, your family members, or members of your household, for example for your child moving in after completing their studies. In everyday language, this is referred to as personal use (Eigenbedarf).

• Construction work. You intend to permissibly demolish the premises or alter or renovate them so substantially that the measures would be significantly impeded by a continuation of the tenancy, for instance in the case of a planned core renovation with a set schedule.

• Service duties. You want to let the premises to a person obligated to perform services, for example as company housing (Werkwohnung) for an employee.

The law does not specify any other reasons. A planned sale or the desire to first see if things work out does not justify a fixed term.

Exceptions are regulated in Section 549 (2) BGB. Among other things, Section 575 does not apply to residential space let only for temporary use, nor, under the conditions stated there, to furnished living space within your own dwelling. The law does not define when a use is merely temporary; the distinction is outlined in Renting out furnished flats. The Tenancy Law Package II (Mietrechtspaket II) would narrow the exception for temporary use, but it is merely a government draft (BT-Drs. 21/6807 of 01.07.2026) and not current law.

Notifying the reason for the fixed term: Template, written form, and timing

The reason alone is not sufficient. Under Section 575 (1) BGB, the landlord must communicate it to the tenant "in writing upon conclusion of the contract", "otherwise the tenancy shall be deemed to have been entered into for an indefinite period".

In writing refers to the written form pursuant to Section 126 BGB: a physical document with a handwritten signature. The electronic form with a qualified electronic signature can replace it (Section 126 (3), Section 126a BGB); for the contract itself, both parties must sign. A simple email or messenger message only satisfies the text form (Section 126b BGB).

Upon conclusion of the contract means: together with the contract. A notification weeks later is, according to the wording, not a notification upon conclusion of the contract. The simplest method is to include the reason as a dedicated clause in the contract text signed by both parties.

How specific the reason must be is not defined in the statutory text; according to the legislative rationale, neither a reference to the statutory wording nor its formulaic repetition is sufficient; a concrete real-life factual circumstance is required (BT-Drs. 14/4553, p. 70). Write down who is moving in or what measure is planned. The first category requires that you intend to use the premises; "personal use possible" merely describes a possibility, leaves open who is to move in, and is therefore insufficient. According to the legislative rationale, the landlord may not later switch to another of the three fixed-term grounds; if the landlord's son moves in instead of the daughter, it remains the same ground (BT-Drs. 14/4553, p. 71). As a template (placeholders in square brackets; does not replace legal examination of your individual case):

"The tenancy is limited in accordance with Section 575 (1) BGB until [Date]. Reason for the fixed term: Following the end of the tenancy period, [Landlord's name] intends to use the premises as a home for [themselves or name and relationship to the landlord], because [specific occasion/reason]."

In the case of construction work or letting to a person obligated to perform services, you instead describe the planned work or the person and their service duties.

If the reason, the written form, or the notification upon conclusion of the contract is missing, the tenancy is deemed to have been entered into for an indefinite period. The landlord can then only terminate it with a legitimate interest (Section 573 BGB) and in compliance with the notice period in Section 573c BGB. Which grounds for termination are viable is explained in Terminating a tenancy agreement: what landlords must consider. In the case of a term of more than one year, Section 550 BGB additionally applies: If the tenancy agreement is not concluded in writing, it likewise applies for an indefinite period.

Fixed-term contract vs. exclusion of termination: The difference

In everyday language, "fixed-term" often means planning security for the initial years. A waiver of termination (Kündigungsausschluss) serves this purpose: The contract remains indefinite, ordinary termination is excluded for a specific period, and thereafter it continues as usual. It does not require one of the three grounds from Section 575 BGB.

A limit applies to standard form contracts: According to the case law of the Federal Court of Justice (BGH), an exclusion of termination—even a mutual one—in a standard form contract is generally invalid if it exceeds four years, calculated from the conclusion of the contract to the point in time at which the tenant can first terminate (BGH, judgment of 06.04.2005, VIII ZR 27/04; BGH, judgment of 08.12.2010, VIII ZR 86/10). If individually negotiated, the commitment may be significantly longer, up to the limit of Section 138 BGB. Even a missing statutory ground can still bind: Where the tenant had requested the fixed term and both parties intended a long-term commitment, the Federal Court of Justice in one case interpreted it instead as a mutual waiver of termination for the agreed term (BGH, judgment of 10.07.2013, VIII ZR 388/12).

Which additional clauses in the contract cause trouble will be covered in a separate article on the mandatory contents of tenancy agreements.

With EverReal Go!: Sign contracts digitally and hand over properties digitally

If you want to sign and hand over digitally, the Plus package from EverReal Go! includes tenancy agreement templates, qualified e-signatures, and digital handover logs. You must always communicate the reason for the fixed term under Section 575 BGB to the tenant in writing upon conclusion of the contract. Plus costs a one-time fee of 59 euros per letting process including VAT, valid for six months; listing on portals additionally requires Flexible Listings, starting from 59 euros per 30 days (Pricing overview).

Record the information deadline upon conclusion of the contract

At the earliest four months prior to the expiry of the fixed term, the tenant may request that the landlord inform them within one month whether the reason for the fixed term still applies (Section 575 (2) BGB). If the notification is sent later, the tenant may demand an extension by the period of delay. This deadline should be added to the calendar right when concluding the contract.

If the reason is postponed or ceases to apply, the tenant can demand an extension

If the reason only arises at a later date, the tenant may demand an extension by a corresponding period. If the reason ceases to exist altogether, they may demand an extension for an indefinite period (Section 575 (3) BGB). The burden of proof for the occurrence of the reason and the duration of the delay lies with the landlord. Retaining plans, quotes, and permits from the very beginning makes proof easier.

Check move-out after the final day and plan for an objection

A fixed-term tenancy ends upon the expiry of the period without any need for notice of termination (Section 542 (2) BGB). If the tenant continues to use the property, it is extended indefinitely pursuant to Section 545 BGB unless one party declares their opposing intent within two weeks; for the landlord, this period begins as soon as they become aware of the continuation. The objection must be demonstrably submitted within these two weeks.

Early termination is only possible extraordinarily or by mutual agreement

The law provides for ordinary termination only in the case of tenancies without a fixed rental period (Section 542 (1) BGB). Extraordinary termination without notice for good cause remains possible (Section 543 BGB, supplemented for residential space by Section 569 BGB), for example in cases of significant rent arrears, as does extraordinary termination with statutory notice in cases permitted by law (Section 575a BGB). Furthermore, both parties can terminate the tenancy by mutual agreement.

Conclusion: Fixed-term tenancy only with communicated reason

The fixed term is only valid if three factors coincide: one of the three statutory reasons, written notification, and timing upon conclusion of the contract. If any of these is missing, the tenancy is deemed indefinite, and its termination is governed by Section 573 BGB. The complete process is outlined in Renting out an apartment: the complete process.

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Legal notice: We do not provide legal advice. For specific legal questions, consult a lawyer specializing in tenancy and residential property law or your local property owners' association, such as Haus & Grund.

Legal status: October 2026, according to the statutes and court rulings cited below.

Sources

• BGB, gesetze-im-internet.de, accessed on 14.10.2026: § 126, § 126a, § 126b, § 138, § 542, § 543, § 544, § 545, § 546, § 549, § 550, § 569, § 573, § 573c, § 575, § 575a

• BGH, judgment of 10.07.2013, Case No. VIII ZR 388/12 (Consequences of an invalid fixed term, exclusion of termination by individual agreement), full text of judgment (PDF)

• BGH, judgment of 06.04.2005, Case No. VIII ZR 27/04 (Standard-form waiver of termination over four years), full text of judgment

• BGH, judgment of 08.12.2010, Case No. VIII ZR 86/10 (Calculation of the four-year limit from contract conclusion), full text of judgment

• Federal Government draft bill, BT-Drs. 14/4553, pp. 70 f. (Rationale for Section 575 BGB: Requirements for notifying the fixed-term ground and changing the fixed-term ground)

• Federal Government draft bill, BT-Drs. 21/6807 of 01.07.2026 (Draft of an Act Amending the Law on Residential and Commercial Tenancies, Tenancy Law Package II), draft, not enacted

• Prices and scope of services of EverReal Go!: de.everreal.co/go/preise, accessed on 14.10.2026

• 450+ real estate companies: Self-reported by EverReal, as of September 2026

Frequently Asked Questions

When is a fixed-term tenancy agreement valid?

A fixed-term tenancy agreement is valid if one of the three reasons under Section 575 (1) BGB applies and the landlord informs the tenant of it in writing upon concluding the contract; otherwise, the tenancy is deemed to have been entered into for an indefinite period. The three reasons: The landlord intends to use the premises after the tenancy period as a home for themselves, their family members, or members of their household; intends to permissibly demolish or substantially alter or renovate them so that the measures would be significantly impeded by a continuation of the tenancy; or intends to let them to a person obligated to perform services. Among other things, Section 575 does not apply to residential space let only for temporary use pursuant to Section 549 (2) No. 1 BGB.

How long can you let on a fixed-term basis?

Section 575 BGB does not stipulate a maximum duration. A fixed-term tenancy agreement for two years is therefore just as possible as a longer one, provided one of the three statutory reasons exists and was communicated in writing upon conclusion of the contract. The reason acts indirectly: It relates to the time following the expiry of the rental period, and if it occurs later or ceases to apply, the tenant can demand an extension (Section 575 (3) BGB). An outer limit is set by Section 544 BGB: If a tenancy agreement is concluded for more than 30 years, either party may terminate it with the statutory notice period after 30 years following handover of the leased property, unless the contract was concluded for the lifetime of the landlord or tenant. This must be distinguished from a waiver of termination in an indefinite contract: In a standard form contract, it is generally invalid under Federal Court of Justice case law if it exceeds four years (BGH, judgment of 06.04.2005, VIII ZR 27/04; BGH, judgment of 08.12.2010, VIII ZR 86/10).

Can I terminate a fixed-term tenancy agreement early?

Ordinary termination is excluded during the term. The law only provides for it in the case of tenancies without a fixed rental period (Section 542 (1) BGB); a fixed-term tenancy ends upon the expiry of the period (Section 542 (2) BGB). Extraordinary termination without notice for good cause under Section 543 BGB and, for residential space, under Section 569 BGB remains possible for both parties—such as in cases of substantial rent arrears by the tenant—as does extraordinary termination with statutory notice in cases permitted by law (Section 575a BGB). In addition, both parties can mutually agree to end the tenancy.

What happens after the fixed term expires?

A validly fixed-term tenancy ends upon the expiry of the period without anyone needing to give notice (Section 542 (2) BGB); thereafter, the tenant must return the apartment (Section 546 BGB). If the tenant does not vacate and continues to use the premises, the tenancy is extended indefinitely under Section 545 BGB unless one party declares an opposing intention within two weeks. For the landlord, the period begins as soon as they become aware of the continuation. In addition, the tenant has rights under Section 575 BGB: At the earliest four months prior to expiry, they may request that the landlord inform them within one month whether the reason for the fixed term still exists. If the reason only arises later, they may demand an extension by a corresponding period; if the reason ceases to exist, an indefinite extension. The burden of proof for the occurrence of the fixed-term reason and the duration of any delay rests with the landlord.

Is a fixed-term tenancy agreement the same as an exclusion of termination?

No. A fixed-term tenancy agreement under Section 575 BGB ends automatically at the agreed time and requires one of the three statutory reasons. An exclusion of termination (Kündigungsausschluss) is contained in an indefinite contract and merely excludes ordinary termination for a certain period; thereafter, the contract continues. It does not require a statutory fixed-term ground, but is subject to a limit: In a standard form contract, even as a mutual waiver, it is generally invalid under Federal Court of Justice case law if it exceeds four years, calculated from the conclusion of the contract to the point at which the tenant can first terminate (BGH, judgment of 06.04.2005, VIII ZR 27/04; BGH, judgment of 08.12.2010, VIII ZR 86/10). If negotiated individually, the binding period can be considerably longer, up to the limit of Section 138 BGB (BGH, judgment of 10.07.2013, VIII ZR 388/12). If the goal is merely planning security for the initial years, an exclusion of termination is usually what is intended.

Is there a template for a fixed-term tenancy agreement?

A standard residential tenancy agreement serves as a template, supplemented by the written notification of the reason for the fixed term, which must take place upon concluding the contract (Section 575 (1) BGB). For the first category, planned use as a home, this clause can serve as a starting point; adapt the placeholders to the individual case: "The tenancy is limited in accordance with Section 575 (1) BGB until [Date]. Reason for the fixed term: Following the end of the tenancy period, [Landlord's name] intends to use the premises as a home for [themselves or name and relationship to the landlord], because [specific occasion/reason]." In the case of construction work or letting to a person obligated to perform services, the text will instead state the planned measure or the person and their service duties. If the term exceeds one year, the entire contract must be concluded in writing (Section 550 BGB). This example does not replace an assessment of the individual case.