Inflation hits rent and the Government is studying temporarily freezing increases with the CPI

• MARIA HERNANDEZ |

  GABRIELA GALARZA (GRAPHICS)

  Madrid

Updated Wednesday, March 23, 2022-02:16

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Tenants look out at the end of each month with the fear that it will be the last before a new and notable rise in the rent they pay, this time as a result of the exorbitant increase in inflation.

The

in recent months are affecting the annual revisions of the contracts with the owners and the increase in prices has led the Government to consider

, at least until the end of the year.

The proposal is on the table of the Ministry of Transport, Mobility and Urban Agenda, from where they confirm that it is one of the measures they are studying to deal with the impact of rising inflation on households.

The same sources assure that

, although in the specific case of freezing they want to ensure its effectiveness, as well as the legal framework of the change.

The possibility of approving it

, in the way that was done during the pandemic, is one of the alternatives, but the Government wants to ensure that the result is well argued and legally justified.

That is why it is not clear whether the measure, if it goes ahead, will be included on March 29 in the regulatory package that it prepares to mitigate the economic impact of the invasion in Ukraine or will be delayed for several weeks until a clearer position is obtained.

The idea came from United We Can and several unions, but the Executive does not want to take false steps.

The rent has been one of the points of greatest conflict between the two government partners, especially in the framework of the approval of the future Housing Law.

The norm is now in the parliamentary process, but there were moments in the legislature when not only its elaboration was in danger, but also the very continuity of the coalition that brought Pedro Sánchez to La Moncloa.

United We Can from the outset demanded direct intervention in rents to avoid abusive increases in rents, something that the PSOE initially refused but ended up including in the final proposal.

The freezing now of the mechanism to update the lease contracts based on the CPI could once again

, hence the Ministry wants to close a formula that does not give rise to misunderstandings about its exceptionality and conjunctural nature.

Rises in rents

Meanwhile, tenants are facing further increases in their rents.

Since last March 2021,

until reaching a rate of 7.6% year-on-year at the end of February 2022, the highest in the last 36 years.

For a year, the tenants who have had the annual review of their contract have had to negotiate a rise in their rents.

In Spain

in some contracts, although it is not mandatory.

In the event that the index is used to update the rents, it must be done

Once calculated, the landlord must notify the tenant one month in advance of the day on which it is time to pay the new monthly payment.

According to calculations by the Idealista real estate portal, people who have had to review the contract with the February CPI have suffered an average increase in monthly rent of 53 euros, which is about 634 euros more per year.

However, the impact has not been the same throughout the country.

"In

, the increase in average rents to be paid is even more noticeable with 65 euros, 62 euros, 49 euros and 42 euros more per month, respectively, which means between

for tenants," explains the portal.

The analysis also reflects that

rents grew even above inflation, while in Malaga (5.2%) and Madrid (2.3%) the rise in the rental offer continued below what the CPI has increased.

The top in Catalonia

The data from the Ciudad Condal is striking, taking into account that the last almost 17 months its rental market has been conditioned by the application of the Catalan law that established a ceiling on rents.

Despite the fact that during the first year of the pandemic prices reflected drops that experts attribute to the reduction in supply, since the end of last year rents in Barcelona have shown year-on-year increases.

"The main cause that is leading to this rise in prices in Barcelona is

, which is becoming more and more abundant in the city," says María Matos, director of Studies and spokesperson for Fotocasa.

Currently, the three most expensive districts of the city -

- account for 62% of the total rental offer in Barcelona, ​​while the three cheapest districts -

- barely have 8% of the total supply of rental housing.

Comparing between the most expensive and cheapest neighbourhoods, there is a difference of almost 800 euros to rent a home: while in Ciutat Vella the average for a 100 square meter flat is 1,882 euros per month, in Horta, the average for renting a 80 square meter apartment is 1,055 euros per month.

Thus, the increase in supply in the most expensive areas and the decrease in the cheapest is what is causing the average price of the city to rise compared to previous years.

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