Tenants won’t be able to afford the energy surcharges, so problems await apartment owners as well

20 December 2022

Significantly rising energy prices will have a major impact on the rental housing market. A large number of owners of rental properties have energy bills written directly to themselves and have not yet changed the amount of their tenants’ deposits. They may not even be aware that the increase in costs affects them as well. As attorney Pavel Strnad of the Polverini Strnad Law Firm points out, annual arrears can easily reach tens of thousands of crowns in the current situation, even in a smaller apartment, which can complicate the situation not only for tenants but also for landlords.

“Energy prices have risen dramatically compared to last year. Landlords of rental properties usually did not take this into account and did not agree with tenants on an immediate adjustment of the amount of deposits. The tenants often have no idea that they will also be affected by the much-publicised increase. Or that the electricity in their flat was supplied by a bankrupt supplier and the landlord received annual bills with vastly different prices. When the tenants see the bills, they will be unpleasantly surprised and it will bring complications not only to them but also to the landlords. They do not put enough emphasis on the legal protection of their property and often have poorly set up contracts with their tenants,” says attorney Pavel Strnad of Polverini Strnad.

A significant wave of price changes is occurring right now at the end of the year. After a period when customers benefited from the so-called savings tariff and had their renewable energy payments forgiven, a large number of them are now seeing their energy prices rise to the prices capped by the government. At the same time, landlords are already receiving bills from new suppliers, which they switched to late last year after the collapse of several energy suppliers.

“Of course, it depends on the specific tariffs and any price fixing by individual energy providers, but the increases will be dramatic sooner or later anyway. This will have a negative impact on all tenants and, in the event of their insolvency, also on landlords. The extreme solution – eviction of a non-paying tenant – may take years, while the owner of the property will not have any income from it for the whole time, on the contrary, he has to spend additional funds,” concludes attorney Pavel Strnad of the Polverini Strnad Law Firm.

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