In Spain, amid growing demand for housing and inflation, many tenants are questioning the legality of increasing rental prices. In this context, the Housing law and the Law on Urban Leases (LAU) have established clear boundaries to protect tenants’ rights. In 2024, landlords will be able to increase rents by up to 3% in properties annual renewalscompared to the 2% limit that was in force in 2023. This implies that, for example, if a tenant pays 1,000 euros per month, the new rent could reach 1,030 euros, or 30 euros more per month.
From 2025, a new reference for rent increases that will be more stable and lower than CPI. For contracts prior to the Housing Act, any increase must adapt to what was agreed in the initial contract, but the new limit of 3% it continues to apply. The law also prohibits owners from imposing unexpected expenses, such as garbage fees or community feesto the tenant. Although some owners have attempted to circumvent these restrictions by seasonal rental contractsthese practices may be illegal and therefore reported to the authorities. In the event of an irregular increase, tenants have the right to refuse the increase and seek legal advice.
Housing rental prices in 2025
He rental market in Spain continues to experience a significant increase in prices. In August 2024, the average rental price It reached 13.1 euros per square meter, which represents an increase of 9.8% compared to the previous year.
This implies that renting an apartment of 80 square meters costs approximately 1,048 eurosalmost double what was paid in 2014, when the average rent was 553 euros. This price increase is largely due to new lease contracts, since the Housing Act limits increase to 3% for existing contracts.
Adopted on May 26, 2023, the housing law introduced several measures, including limiting the increase in rental prices. In 2023, the maximum increase was set at 2%, while for 2024 it was set at 3%. However, owners can set the price they deem appropriate for rent your houseunless your autonomous community declares the area as stressed. In this case, the reference price will be based on the last contract plus an adjustment of 3%.
By 2025, changes are planned in the way rental prices are updated. The Housing Act establishes that National Institute of Statistics (INE) must define a new benchmark index before December 31, 2024. This new index, which has not yet been determined, will replace the CPI.
Likewise, the new regulations also consider the possibility that rent increases be cumulative. In other words, if the rent does not increase in 2024, a larger adjustment could be applied in 2025.
Income Update
According to article 18 of Law on Urban Leases (LAU)the rental price may be updated annually during the term of the contract, provided that this has been expressly agreed between the parties. If a reference methodology is not established, the annual variation of the Guaranteed Competitiveness Index (IGC) corresponding to the last index published at the time of contract renewal will be applied.
If an upgrade is not agreed, the rental price will remain fixed for the duration of the rental. duration of contract. Although the CPI has been the most used indicator to adjust rents, the new regulations dissociate lease contracts signed between April 1, 2022 and December 31, 2024 from the CPI, limiting any increase to a maximum of 3 %. This limit is set in final provision 6 of the Housing Act.
Evictions and vulnerable families
On the other hand, one of the main doubts for 2025 concerns the possible continuation of suspension of evictions for families in vulnerable situations. During the year 2024, this measure is in force, protecting those who are experiencing economic difficulties. The royal decree approved in December 2023 provides that this suspension will last until December 31, 2024, but it has not been defined whether it will be extended beyond this date.
In addition, the decree envisages a compensation of the owners concerned due to the inability to evict vulnerable tenants. This compensation, available until January 31, 2025, aims to mitigate the economic losses suffered by owners due to the legal situation.
In summary, the year 2025 promises to be a difficult period, with significant changes in the rate of updating rents and in the regulation of evictions this could have a significant impact on the real estate market. These adjustments will impact both landlords and tenants, who will have to adapt to new regulations and circumstances.
