The cap to the rent enters into force from now
The control of rental prices is already a reality. The Official State Gazette has published this Saturday the royal decree-law that limits the annual update of rents to 2% until December 31, 2027, a measure that affects both small landlords and large holders.
The rule comes into force immediately, which implies that all contracts that expire from now on must adjust to this new limit. The objective, according to the text itself, is to contain the impact of the rising cost of energy and prevent housing costs from skyrocketing in an increasingly strained economic context.
Automatic extension of contracts up to two years
The decree also introduces a second key measure: the automatic extension of rental contracts that expire between 2026 and 2027 for a maximum period of two years.
This means, in practice, that thousands of contracts will not be able to be updated freely nor end under the usual conditions, but rather will remain extended under the current terms, with the 2% limit as a reference for any price review.
The mechanism seeks to provide stability to tenants at a time when economic uncertainty and price volatility are conditioning the real estate market.
The war in Iran, at the origin of the measure
The Government itself directly links this intervention to the impact of the war in the Middle East. The decree recognizes that Spain is in a housing crisis that can be aggravated by the inflationary effect of the conflict.
The text points out that the rising cost of gas and oil —derived from the war— will have an immediate impact on inflation, just as the European Central Bank has already warned.
The concern of the Executive is to avoid a chain effect: more expensive energy, higher inflation and, as a consequence, an additional rise in rents that ends up straining household economies even more.
The objective: to avoid that the rent exceeds 30% of the income
The rule sets as a red line that the cost of housing, added to basic expenses, does not exceed 30% of the average income of households.
To this end, the decree justifies the need to adopt “extraordinary and urgent” measures that curb the evolution of prices in a market already strained by the scarcity of supply and the increase in demand.
The Executive also points to structural factors, such as the lack of application of stressed areas in some autonomous communities, which have limited the effect of the previous regulation.
A market under growing pressure
The 2% limit is in line with the most recent reference index, although it introduces a generalized restriction that affects the entire market, regardless of the type of landlord.
The measure comes at a time when the rental market has accumulated years of increases and when the evolution of energy prices adds a new layer of pressure on living costs.
An intervention in the midst of a global economic escalation
The Government's decision occurs in parallel with an international context marked by instability. The war in the Middle East has shot up energy prices, has strained financial markets and has forced central banks to rethink their strategy given the risk of persistent inflation.
In this scenario, housing becomes one of the main fronts of action to avoid an accelerated deterioration of households' purchasing power.