Are rents in Spain really going up? A 2014–2025 snapshot (and where the pressure is highest)
Looking over the last decade, the short answer is yes: rents have risen sharply. In 2014 the average rent hovered around €553, and by 2024 the average reached roughly €984 — a substantial climb that’s been most pronounced in coastal areas and destinations with strong international and tourist demand. In those markets, rises have stacked up year after year.
In 2024 you could already see the signals: official data showed year-on-year rent growth around the low single digits nationally, while private trackers flagged double-digit increases in specific regions and city segments. In 2025 the pressure hasn’t eased: the islands and the Mediterranean arc remain among the tightest markets.
If you work the Costa del Sol, you feel it every day: more international demand, a more professional landlord base, and seasonal spikes that clear out good stock in beachfront, golf, and well-connected zones. In day-to-day terms, when a well-presented flat hits the market in the Sotogrande–Estepona strip at a price in line with fresh comparables, it goes in days, not weeks.
Tip to differentiate your page: open this section by contrasting “your patch” with national figures (for example: “in Marbella–Estepona, the median time-to-let for a furnished two-bed is X days vs Y nationally”). Update that stat quarterly.
IRAV 2025: the new INE index for updating rents (goodbye CPI)
From 1 January 2025, you no longer update primary-residence rents by CPI: the Índice de Referencia de Actualización de Viviendas en Alquiler (IRAV) — a rent-update reference index produced by Spain’s statistics office (INE) — is now in force. IRAV is published monthly (early each month for the previous month) and applies to main-home contracts signed after 25 May 2023 under Spain’s Housing Law. It does not apply to seasonal lets, room rentals, or commercial premises.
How does IRAV work? In short, it takes the lowest value among three references: year-on-year headline CPI, core inflation, and a smoothed annual rate designed to avoid spikes and converge towards a moderate long-run level. The goal is to prevent shocks like those seen in 2022 when CPI surged. For you, that means more predictability at the annual update and less friction with tenants when discussing increases.
In practice, you’ll want IRAV written into the rent-update clause of new contracts and included in formal notices to tenants (one month’s notice, one update per 12 months). Explain it clearly at signing — it saves you a thorny renegotiation a year later.
How much can your rent go up? Real examples and a quick mental calculator
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Base case: rent €1,200/month, contract hits 12 months in June 2025, latest IRAV prints 2.2%. Increase is €1,200 × 0.022 = €26.40 → new rent €1,226.40 after one month’s notice.
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2024 vs 2025: in 2024 the legal cap for annual updates was 3%; in 2025 you use IRAV. IRAV can come in lower or higher as the year evolves, but it’s designed to be more stable than CPI.
Pocket maths for viewings:
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€900 → +2.2% = +€19.80 → €919.80
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€1,500 → +2.2% = +€33.00 → €1,533.00
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€2,200 → +2.2% = +€48.40 → €2,248.40
On the Costa del Sol, you’ll often sanity-check this number against live demand in the segment. If market evidence shows comparable homes letting at €100–€150 more (furniture, condition, views, parking), you can adjust asking price at renewal (always within the legal framework).
Housing Law: caps, “stressed areas”, and the rules that matter (for tenants and landlords)
Spain’s Housing Law gave you two practical headlines for 2024–2025:
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2024: a 3% cap on the annual update.
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2025: IRAV replaces CPI as the update reference.
Other operational points you shouldn’t miss:
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Large landlord (gran tenedor): generally more than 10 dwellings or over 1,500 m² of residential space; in stressed areas, thresholds may drop to five in the same zone.
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Vacant dwelling & council tax (IBI): municipalities may apply up to 150% surcharges on long-term vacant homes in certain cases.
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Agency/arranging fees: landlord pays — not the tenant.
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Extraordinary one-year extension for vulnerable households (when the landlord is a large holder).
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Mediation/conciliation strengthened in evictions involving vulnerability.
For new contracts, bake this into clean templates: spell out who pays what, how notice works, and whether the property may fall in a stressed area (regional/local designation). A solid “first-time landlord checklist” (10 items) in your onboarding meeting avoids surprises later.
Costa del Sol up close: demand, new-build, and “hot” micro-locations (Sotogrande–Estepona)
On the western end of the Costa del Sol, property for sale in Estepona shows how energy-efficient new-builds with terraces and parking are setting the pace on rents. Meanwhile, marina-and-golf micro-locations remain tight: property for sale in Sotogrande continues to achieve a premium where finish, views, and on-site services align.
In Sotogrande, Estepona, and up towards Benahavís, demand for well-equipped homes (A/C, parking, terrace) has increased for both long-lets and mid-stays (remote workers/temporary residents). New-build and turnkey units often command a premium over older stock: energy efficiency, basic smart-home features, and amenities (pool/gym) justify 10–20% higher rents in like-for-like comparisons when the market is tight.
Your operational edge is what keeps deals smooth: no small print, 7-day availability, and a local network (lawyers, refurb, furnishing). That lets you:
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Prep a home for market in under a week with good photos and light staging.
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Align landlord expectations with a realistic price band and the next IRAV update.
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Advise on cap rates using what you see daily: if the open-market rent is already €100–€150 above the in-place contract, match IRAV now and revisit asking price at the next renewal — retention of a strong tenant often beats a short-term spike.
Actionable advice: negotiate well, index correctly, and prep the next contract
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Update clause: reference IRAV explicitly in new contracts. Remember annual update and one month’s notice. You’ll avoid disputes and set expectations from day one.
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Documentation: prepare a three-part renewal pack (update letter, IRAV calculation, local comparables).
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Realistic asking price: for a new tenancy, use comparables from the last quarter and the current demand picture (viewings, offers, lead flow).
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New-build = less friction: think zero-maintenance, manuals, energy efficiency (lower running costs = fewer objections on price).
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Avoid common mistakes: using CPI in 2025, missing the notice window, weak photo/inventory sets that waste the crucial “first week”.
Bottom line: what to expect in 2025 if you rent or invest in Spain
For 2025, IRAV gives you a stable path to update rents; price pressure remains in coastal destinations and big cities; and the legal framework rewards watertight contracts and clear tenant comms. On the Costa del Sol — where you handle a strong new-build and off-plan pipeline — your value proposition (clarity, local network, availability) is exactly what helps landlords and tenants navigate sensible rent increases without damaging the relationship.
