Strategies for determining July rent hikes made simple
Monthly rent adjustments are no strangers for landlords and tenants alike in Argentina. Depending on the law they've signed under, these adjustments can vary. Those who agreed upon contracts under the 2020 law with its 2023 amendments have annual updates until the contract ends. These updates are based on the Index for Lease Contracts (ICL) established by the Central Bank.
However, President Javier Milei repealed the rent control law in December 2023, opening the door to define how these contracts are updated. While contracts signed before the repeal maintain their original terms, new contracts are updated based on either the ICL or the Casa Propia coefficient, depending on the agreement.
Calculating the rent increase can be done through different methods. One option is using an online calculator, like Arquiler, by inputting the initial rent value, contract start date, update frequency, and index for updating. This calculator will return the amount to be paid during the next year and the percentage increase.
Another option is accessing the official Central Bank website, where the ICL is updated daily. Users can do the calculation manually by finding the index value when the contract started and the current one, then dividing the current index by the initial index and multiplying it by the rent value.
For some, choosing to adjust rent according to inflation may be more beneficial. The new rules of the DNU allow owners and tenants to agree on adjustments and choose which index to use and the frequency of the update. The contracts made since January 2024 can be adjusted using the IPC index with quarterly or semi-annual lapses.
Regardless of the chosen method, calculating the rent increase helps both landlords and tenants make informed decisions when reviewing and updating rental agreements.
In the new rules established post-December 2023, both landlords and tenants have the freedom to adjust rental contracts based on either the Index for Lease Contracts (ICL) or the Casa Propia coefficient, as per their agreement. Those with contracts after January 2024 can opt for the Consumer Price Index (IPC) and choose between quarterly or semi-annual updates. With various calculation methods available, whether using an online tool like Arquiler or manually accessing the ICL from the Central Bank's official website, determining the rent increase enables both parties to make informed decisions when revising rental agreements.
