Do you have doubts about how your rent will be impacted by the new 2025 index? Are you worried about how much your monthly rent will increase and how to manage it? Knowing how these changes are applied will allow you to better plan your budget and avoid surprises.

This new index not only affects tenants, but also landlords, albeit in a different way. The updating of contracts based on this index affects all rental contracts, and although it may seem complex, in this guide we explain the basics so that you understand the process.

From what this index means to how it is calculated and how it will affect your rent this year, here you will find all the information you need to find out if you are affected and how to optimise your rent payments.

What is the new rent index 2025 or rent update index?

The rent equalisation index is a mechanism used to adjust rents in lease contracts according to economic factors. Until now, most leases were updated with the Consumer Price Index (CPI). However, due to the large fluctuations of the CPI in recent years, in 2022 the government set a ceiling of 2% to protect tenants.

From 2025, a new benchmark index, calculated by the National Statistics Institute (INE), comes into force. This index is more stable and is based on factors such as underlying inflation and maintenance costs, providing a more predictable update.

What to do if your contract will be updated with the 2025 rent index?

If your lease is up for renewal, follow these steps to make informed decisions:

  1. Check your contractCheck that it includes a rent update clause, as this is essential for adjusting the rental price.
  2. Check if the new INE index is appliedContracts signed after 25 May 2023 will have to be adjusted to this index. Earlier contracts will continue to be based on the CPI.
  3. Consult the updated indexThis index is published on a monthly basis. For example, the index for January 2025 was 2.2%. If your contract is updated that month, this is the percentage increase to be applied.
  4. Talk to your landlordIf your contract is still linked to the CPI, you can negotiate with your landlord to include the new index to ensure greater future stability.

Practical example:

Imagine that your rent is 850 euros. If the rate is 2.2%, the increase will be 18.70 euros, resulting in a new rent of 868.70 euros.

This update will only apply if your lease has an update clause and if the landlord has notified you at least 30 days in advance, in accordance with the Urban Lease Law (LAU).

Does it affect you if you are a tenant and how does it affect you?

If you are a tenant, it is essential that you understand the terms of your contract:

  • Contracts signed after 25 May 2023These should be adjusted to the new INE index, which means that annual updates will be limited by this value, providing greater predictability and protection against unexpected increases.
  • Contracts signed before 25 May 2023If your revision clause uses the CPI, the landlord can continue to apply it, but also has the option to use the new index, as long as it does not exceed the maximum limit.
  • Contract renegotiationIf your lease is up for renewal, you could take the opportunity to negotiate with your landlord the application of the new index and ensure a more stable rent in the long term.

How does the new index protect you?

The INE index was designed to ensure that increases are reasonable and predictable. By decoupling it from the fluctuations of the CPI, it gives you greater security when managing your monthly budget.

How does this affect owners and who should apply the index?

The regulations distinguish between two types of owners:

  • Large forksThose with more than five rented dwellings must compulsorily apply the new INE index in all their contracts, while respecting a maximum limit of 3% in any update.
  • SmallholdersThey must also apply this index to contracts signed after the Housing Act, but have more flexibility to negotiate with tenants.

Benefits for owners:

  • PredictabilityThe new index provides a clear way of calculating rents, which helps to avoid conflicts with tenants.
  • Attractive for long-term tenantsOffering contracts based on a predictable index can attract tenants interested in stability.
  • Economic stabilityBy limiting rises, the index helps to maintain stability in the housing market, promoting more balanced relationships between landlords and tenants.

How to calculate your rent update?

Calculating the update with the INE index is simple:

  1. See the monthly index. For example, if the index for January 2025 is 2.2%.
  2. Apply the percentage to your monthly rent: multiply your rent by the index and add the result to your current rent.
  3. Make sure that the landlord has given you 30 days' notice of the upgrade.