In 2025, updated rules for rent revision remain in effect in Spain, directly linked to the Consumer Price Index (IPC). These changes affect both tenants and property owners, significantly impacting the housing market.
The main provisions for rent updates are set out in Article 18 of the Law on Urban Leases (Ley de Arrendamientos Urbanos, LAU). According to the law, if the contract does not specify a particular index for revision, the Competitiveness Guarantee Index (IGC) is applied. However, in practice, the Consumer Price Index (IPC) is most commonly used, as it reflects inflation trends in the country.
The Consumer Price Index (IPC) is a key indicator that tracks changes in the cost of goods and services included in the consumer basket. It is calculated by the National Institute of Statistics (Instituto Nacional de Estadística, INE) based on an analysis of prices for the most in-demand goods and services. When the IPC rises, it means overall prices are increasing, which directly affects rental rates.
Rent revision according to the IPC is possible once a year if specified in the contract. If the parties have not agreed on a specific indexation procedure, the annual change in the IGC at the time of renewal is applied. If there is no indexation clause in the contract, the rent remains unchanged throughout the entire term of the agreement.
To calculate the new rental amount, the IPC value published two months prior to the review date is used. Official data is typically released on the 15th of each month, and tenants must be notified of any increase at least one month before the new terms take effect.
The IPC trend in recent years shows a gradual slowdown in inflation. In January 2023, the index was at 5.9%, dropping to 2.3% by July. In 2024, it fluctuated between 1.5% and 3.6%. According to INE, in July 2025, the IPC reached 2.7%.
In previous years, the government introduced caps on rent increases: in 2022 and 2023, the maximum allowed raise was 2%, and in 2024 — 3%. If the actual IPC was below the limit, the real inflation rate applied.
To calculate the new rent on your own, take the current amount, convert the IPC percentage to a decimal (for example, 2.7% becomes 0.027), multiply by the rent, and add this value to the original amount. For example, if the current rent is €1,200 and IPC is 2.7%, the increase will be €32.4, making the new rent €1,232.4.
From January 1, 2025, for new contracts signed after the Housing Law took effect (May 2023), a special index applies. This index is set as the lowest of the annual IPC inflation, core goods inflation, and the average adjusted indicator. In July 2025, this index was 2.7%.
Contracts signed before the new law came into force continue to be renewed under the terms agreed between the tenant and the owner. In most cases, the IPC is used for recalculation.
For commercial properties, the indexation procedure is determined by the agreement between the parties, and here the IPC is also often applied unless otherwise specified.
Thus, in 2025, tenants and property owners in Spain should take into account the current IPC values and new legislative restrictions when reviewing rental costs. This enables more transparent planning of expenses and income, and also contributes to greater stability in the real estate market.
