Is IPC or IRAV to update the rent? Knowing how much the rent can increase in 2026 requires checking when the contract was signed, what updating mechanism it contains, and who the owner is. Contracts signed after May 26, 2023, reference the new Reference Index for the Update of Housing Leases (IRAV), while for the previous ones, the terms agreed upon in the contract must be followed.
However, since March 2026, there is also an extraordinary limitation of 2% for updates of housing rents, in effect until December 31, 2027, with different rules depending on whether the landlord is a large holder or not.
IPC or IRAV: the date of the contract is fundamental
The implementation of the IRAV has changed the way rental contracts are updated in Spain, but it has not completely eliminated the IPC as a reference. The National Institute of Statistics itself specifies that rental contracts signed after May 26, 2023, are reviewed using the IRAV as a reference, according to Law 12/2023 on the right to housing.
In contracts prior to that date, however, it is necessary to check what the updating clause establishes. Article 18 of the Urban Leasing Law determines that during the validity of the contract, the rent can only be updated when each year of validity is fulfilled and under the terms agreed upon by the owner and tenant. Therefore, not all contracts prior to May 2023 necessarily use the IPC.
This distinction is joined by an exceptional circumstance in 2026. Since March 21, an extraordinary limitation on the annual update of rents has been in effect, introduced by Royal Decree-Law 8/2026. The measure affects the annual periods that occur during its validity and extends until December 31, 2027.
Which contracts use the IPC to update the rent
The IPC continues to be relevant for contracts prior to May 26, 2023, that have expressly established this indicator as a mechanism to update the rent. In these cases, the variation of the IPC constitutes the ordinary reference provided for in the contract, although in 2026, the extraordinary limitation currently in effect must also be taken into account.
This means that it cannot be taken for granted that any old rent automatically increases by the same percentage as the CPI. First, it must be verified that there is an update clause and then identify the agreed mechanism. If the parties expressly established the CPI, this will be the ordinary reference on which the review is articulated, without prejudice to the extraordinary legal limits that are in force at that time.
The Urban Leasing Law also establishes an important rule: if there is no express agreement for updating, no rent update applies. Therefore, the owner cannot unilaterally use the publication of a new inflation data as a sufficient argument to increase the monthly payment.
What contracts use the IRAV
The situation changes for rental contracts signed after May 26, 2023. The INE indicates that these contracts are reviewed using the Reference Index for the Update of Housing Leases, known as IRAV, created as a result of the Law for the Right to Housing.
This new indicator began to take effect from January 1, 2025 and aims to establish a reference limit that prevents disproportionate increases in the annual updates of rents. Its calculation takes into account different price indicators and moderation mechanisms, so IRAV and CPI do not necessarily have the same value.
This difference can be appreciated in the current data. The CPI for July 2026 has been set at 3.6% year-on-year, while the IRAV corresponding to July is at 2.49%. However, neither of those two percentages should be interpreted in isolation as the amount that any owner can apply now, because in 2026 there is also the extraordinary limit approved in March.
Table: which index applies to the rent according to the date of the contract
| Contract situation | Ordinary reference | What happens in 2026 |
|---|---|---|
| Contract prior to May 26, 2023 with IPC update | IPC agreed in the contract | If there is no new agreement, the increase cannot exceed 2% during the validity of the extraordinary limitation |
| Contract prior to May 26, 2023 with another agreed mechanism | The mechanism established in the contract | If there is no new agreement, the extraordinary limit of 2% also applies |
| Contract after May 26, 2023 | IRAV | The extraordinary limitation of 2% in force in 2026 and 2027 must be taken into account |
| Contract without express update agreement | Ordinary update does not apply | The owner cannot automatically update the rent due to the increase in IPC |
| Large holder landlord | The one corresponding to the contract | The increase cannot exceed 2%, even if there is a new agreement |
The extraordinary limit of 2% changes the rules in 2026
The main particularity that must be taken into account currently is the Royal Decree-Law 8/2026, of March 20. The regulation establishes an extraordinary limitation for the annual updates of rents of housing contracts whose corresponding annuality occurs during the application period of the measure, which extends until December 31, 2027.
When the owner is not a large holder, the regulation allows landlord and tenant to reach a new agreement on the increase. However, if there is no new agreement, the update applied cannot exceed 2%. This nuance is important: for these owners, the 2% functions as a limit in the absence of a new agreement between the parties.
The rules are stricter when the landlord is considered a large holder in the terms established by the Housing Law. In that case, even if the owner and tenant reach a new agreement, the annual variation of the rent cannot exceed 2%. If there is no agreement, the same limit remains exactly.
What happens if the contract expressly states that it is updated with the IPC
One of the situations that can generate the most doubts is that of a contract in which there is expressly a clause indicating that the rent will be updated according to the IPC. The clause remains relevant to identify the ordinary mechanism agreed by the parties, especially in contracts prior to the entry into force of the Housing Law.
However, the existence of that clause does not allow ignoring the extraordinary legal limitations that are in force. In August 2026, an owner who is not a large holder and wants to update a rent subject to the CPI will have to consider the extraordinary limitation of 2% if a new agreement with the tenant is not reached.
If the landlord is a large holder, the margin is even smaller: the increase cannot exceed 2% in any case during the extraordinary period, even if the CPI is higher and even if the owner and tenant reach a new agreement on the update.
What happens if the contract says nothing about updating the rent
The absence of an update clause has an important consequence. The current wording of article 18 of the LAU expressly states that, "in the absence of an express agreement, no rent update will be applied to the contracts".
Therefore, that the CPI rises by 2%, 3%, or 5% does not alone allow for an increase in rent if the contract does not contemplate the update. Nor does the existence of the IRAV mean that all rents must be reviewed annually automatically.
There is an intermediate situation: that there is an express agreement to update the rent but it does not specify which index or methodology should be used. In that case, the LAU establishes as a reference the annual variation of the Competitiveness Guarantee Index (IGC) corresponding to the date of update, using the last index published at that time.
When can the owner update the rent
The monthly publication of the CPI or the IRAV also does not determine the moment when the landlord can raise the rent. The LAU establishes that the rent can only be updated when each year of the contract is fulfilled. For example, if the contract started in November, the publication of the indices corresponding to July does not allow for advancing the review to August.
It is also necessary to distinguish between the moment when the annual period is fulfilled and the moment when the new rent begins to be demanded. Legislation establishes that the updated rent is enforceable to the tenant from the month following the one in which the update is communicated to them in writing, expressing the percentage applied.
For this reason, to know when they can raise your rent in 2026, you must first check the start date of the contract and then the update clause. The landlord cannot freely choose any month of the year to modify the monthly payment simply because a high CPI has been published.
How to know how much they can raise your rent in 2026
To correctly calculate an update, several pieces must be gathered. First, the contract signing date must be checked; then, if there is an update clause and what mechanism it establishes; and finally, it must be determined whether the landlord is considered a large holder or not.
If the contract is after May 26, 2023, the IRAV is the reference indicated by the INE for its review. If it is before, the contractual clause must be studied: the CPI or another mechanism may have been agreed upon. If there is no express agreement to update the rent, an automatic update does not apply.
And in 2026 there is one last essential check. The extraordinary limitation of 2% will remain in effect until December 31, 2027. For landlords who are not large holders, this percentage limits the increase when there is no new agreement; for large holders, it constitutes the maximum even if there is an agreement. Therefore, knowing whether it corresponds to CPI or IRAV is only the first step in determining how much a rent can legally increase in 2026.