The National Statistics Institute (INE) made public this Friday the new reference index for the annual update of rental contracts, which in October recorded a year-on-year variation of 2.57%, above the 2.54% recorded in September and reaching its highest level since the start of the series, in November 2024.
With the data corresponding to October, this indicator already chains 17 consecutive months above 2%, consolidating a path of sustained increases.
Rental lease agreements that must review their rent and that were signed since the entry into force of the Housing Law, on May 25, 2023, are required to use this index designed by the INE in order to carry out the annual update.
The statistical body publishes this index monthly, which acts as a cap for the annual review of housing rental contracts. It is expressed with two decimal places and calculated using the latest monthly data available, being the one that will determine the percentage by which contracts signed starting from May 2023 will be revalued.
This indicator integrates jointly the Consumer Price Index (CPI), core inflation, and the differences between the annual growth rates of both the CPI and core inflation for each month, in addition to a parameter, defined at the proposal of the General Directorate for Economic Policy, linked to the expected long-term growth of said index.
On these differences, a moderating coefficient set jointly by the General Directorate of Housing and Land of the Ministry of Housing and Urban Agenda and the General Directorate for Economic Policy of the Ministry of Economy, Trade and Enterprise is applied, taking into account the situation of the residential rental market.
Thus, the reference index that operates as a limit for the annual update of housing lease agreements is established as the minimum value between the annual variation rate of the CPI, the annual variation rate of core inflation, and the average adjusted annual variation rate, calculated in accordance with the approved methodology.
With the dissemination of this indicator, Estadística complies with the eleventh additional provision of the Law for the Right to Housing, which establishes that the body will define, before December 31, 2024, a reference index for the annual update of residential lease contracts, which will act as a limit in order to avoid disproportionate rent increases in these contracts.
Interactive chart of the reference index
Interactive chart: Reference index for residential leases. Annual variation
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