The second data of the new rental reference index in Spain has been placed at 2.28% year-on-year in the month of December, compared to 2.20% in November 2024. The figure, published by the National Institute of Statistics (INE), is used for the annual update of rental contracts.
The rental contracts that will update your rent from 2025 and that have been signed since the entry into force of the Housing Law, on May 25, 2023, must use this new index created by the statistical institute to review the contract.
The INE will disseminate this index on a monthly basis, which will be used as a limit for the annual update of the housing lease contracts, expressed with two decimal places, using the latest monthly data available, which will be the price at which lease contracts signed after May 2023 will be revalued.
What does the new rental index consist of?
The index jointly considers the CPI, underlying inflation and the differences between the annual growth rates of both the CPI and underlying inflation for each month, and a parameter, defined at the proposal of the General Directorate of Economic Policy, which is related to the expected long-term growth of the index.
To these differences we apply a defined moderating coefficient at the joint proposal of the General Directorate of Housing and Land of the Ministry of Housing and Urban Agenda and the General Directorate of Economic Policy of the Ministry of Economy, Commerce and Business, in consideration of the circumstances of the housing rental market.
The reference index that will be used as a limit for the annual update of the housing lease contracts It will be the minimum value between the annual variation rate of the CPI, the annual variation rate of underlying inflation and the adjusted average annual variation rate, prepared as provided in the approved methodology.
The INE complies with the Housing Law
With the publication of this index, Statistics complies with the eleventh additional provision of the Law for the Right to Housing, which establishes that the organization will define, before December 31, 2024, a reference index for the annual update of the housing lease contracts, which will be set as a limit for the purpose of avoid disproportionate increases in the income of lease contracts. In 2024, the update of rental annuities was extraordinary limited to 3% due to the increase in prices derived from the war in Ukraine.
This limit has not been the only limit that the Government has approved in response to the inflation crisis due to the war in Ukraine. The Executive has already limited, through a Royal Decree-Law, the annual update of lease contracts for 2022 and 2023 based on the Competitiveness Guarantee Index (IGC), which is capped at 2% and can never be less than 0%. .
What happens to previous rental contracts
Contracts that have been signed before the entry into force of the Law for the Right to Housing, That is, those signed before May 2023 will continue to update their annual rent with the data from the Consumer Price Index (CPI) or IGC, as stated in the signed rental contract.
According to sources from the Ministry of Housing to Europa Press, based on what the tenants have signed the rental contracts prior to May 2023, The annual revaluation of this income will be made using the inflation data at the date of each update or the IGC, which can never be higher than 2%.
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