MEASURES THAT THE GOVERNMENT HAS TAKEN IN THE ROYAL DECREE OF LAW RELATING TO INCREASES IN THE RENT OF REGULAR HOUSING (IPC)

Last March, the Council of Ministers of the Government of Spain approved the royal decree of law 6/2022 where urgent measures are adopted within the framework of the national plan as a response to the economic and social consequences of the war in Ukraine NO WAR.

Among the measures that have been taken is the one that regulates housing rentals until 30 June 2022. In it is exposed:

Article 46. Extraordinary limitation of the annual update of the rent of housing leases.

The tenant of a housing rental contract subject to the Law 29/1994, of 24 of November, of Urban Leases whose income must be updated because the corresponding valid annual payment is fulfilled within the period between the entry into force of this royal decree-law and the 30 June 2022, may negotiate with the landlord the increase that will be applied in that annual update of the rent, subject to the following conditions:

a) In the event that the lessor is a large holder, The rent increase will be the one resulting from the new agreement between the parties., without being able to exceed the result of applying the annual variation of the Competitiveness Guarantee Index on the date of said update, taking as reference month for the update the one that corresponds to the last index that was published on the date of update of the contract. In the absence of this new pact between the parties, the increase in rent will be subject to this same limitation.

For the purposes of this article, a large holder shall be understood as the natural or legal person who is the owner of more than ten urban properties for residential use or a constructed area of ​​more than 1.500 m2 of residential use, excluding in any case garages and storage rooms.

b) In the event that the lessor is not a large holder, The rent increase will be the one resulting from the new agreement between the parties.. In the absence of this new pact between the parties, The increase in rent may not exceed the result of applying the annual variation of the Competitiveness Guarantee Index on the date of said update., taking as reference month for the update the one that corresponds to the last index that was published on the date of update of the contract. Source “AE BOE”.

Tenants and types of landlords.  We must differentiate two types of landlords.

The first thing our tenants ask us is how to know if their tenants are large holders and when it comes to leases they want to know if an owner who is an individual has the same regulation, or if it is a society; and within societies, the big question is who are the big holders.

By large holder is understood the natural or legal person who is the owner of more than ten urban properties for residential use or a constructed area of ​​more than 1.500 m2 of residential use, excluding in any case garages and storage rooms.

Lessor not large holder: In this case, it is a private owner and the rent increase will be the one agreed between the parties., but if there is no agreement, The increase in rent may not exceed the result of applying the annual variation of the CPI on the date of said update., taking as the reference month the last month published on the contract review date and according to the INE standards.

In conclusion, the tenant of a housing contract subject to the LAU 29/1994, You can negotiate with the landlord the annual rent increase of your habitual residence and, where appropriate, benefit from the limit of 2% By agreement.

Application period: Arrival of the negotiation between the parties (landlord tenant), the increase in annual income, and in order to benefit from the limit of the 2%, said update must occur within the period between the entry into force of this Royal Decree-law (31 march 2022) and the 30 June 2022.

Once the term has expired for those contracts whose update is from the month of July 2022 onwards, the rent review will be reapplied as agreed in the contract; although it could be a renewable measure if inflation continues at these exorbitant levels.

In conclusion, we point out that in a certain way this measure taken for the rental market is in favor of helping the tenant, leaving aside the economic consequences that the non-revision of the rent by CPI may have for the lessors.  We must take into account that approximately 80% of these are NOT big forks, that is, they are small owners.  We must emphasize that we are all suffering the consequences of the GENERAL CONSUMER PRICE INDICES and no compensation has been contemplated for this period to the owners.. What could result, fear of placing your home on the rental market.  

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