Rents closed May with a drop of almost 1%

Rents closed May with a drop of almost 1%

According to the real estate portal, the socio-economic crisis generated by Covid-19, has continued to impact the rental market. «Since the beginning of the pandemic, rents have been more moderate, adapting to the situation families are going through. Nevertheless, mandatory artificial increases are taking place in rents when using the CPI (Consumer Price Index) », explained David Caraballo, commercial director at Alquiler Seguro.

«The CPI registered in the month of May its four-year peak and tenants are facing rent increases, when the market’s reality is very different», he added.

The numbers from May (-0.92%) reflect the rental segment’s situation, very sensitive to any small change. Thus, for example, a 700 euro rental agreement signed in May 2020 would be updated to 693.56 euro this year using the ARCA Index, whereas using the CPI, it would be updated to 718.9 euro.

«The last few months’ evolution shown in the ARCA Index has allowed us to demonstrate how a natural rental price adjustment took place, but the fact is that the legislator turned his back on tenants and passed a law that ties rentals to the CPI and that is causing early contract terminations and increased updates when the opposite should be taking place», clarified David Caraballo.

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