The cap on rent increases is only applied in some cases. / EP

The cap on rent increases is only compulsory in some cases

People who rent out fewer than ten properties can negotiate a higher or lower increase with their tenants or leave the rent the same, but if they disagree the two per cent limit applies

EDURNE MARTÍNEZ MADRID.

One of the measures in the government's Shock Plan to offset the effects of the war was limiting rent increases to two per cent for the next three months, even though the CPI is much higher.

This does not only apply to the most vulnerable, but to all rental contracts which are up for renewal after 1 April. However, it is only an obligation for people who own and rent out more than ten urban properties; for the others it will permit negotiation between landlords and tenants, although if they disagree then rent cannot be increased more than two per cent. In other words, they can agree a higher or lower rate or keep the rent the same. In practice, it is unlikely that a tenant would accept a rent rise of more than two per cent, but the possibility is there.

It is the first time in the history of Spanish democracy that a government has limited a rent increase in this way, deputy prime minister Yolanda Díaz said at a press conference after the cabinet meeting. It is designed to help tenants because "they may be having difficulties paying their rent in these circumstances," she said.

The Ministry of Transport, Mobility and Urban agenda says about 3.5 million people in Spain are tenants. If some rental contracts come up for renewal in every month of the year, a quarter of them will be facing a rent increase between April and June, which means that about 900,000 households will benefit from this restricted rent increase.

Although it is a temporary measure, many estate agencies are not happy about it, saying that landlords have to pay their bills as well and now their income is being restricted. Some believe owners may stop renting altogether, and if there are fewer properties available for rent prices will rise and some people will not be able to afford them.