Discover the keys to understanding and calculating the annual rent increase.
News Colombia.
With the beginning of 2025, Colombians face new financial challenges, among them the adjustment in the value of housing leases. This increase, regulated by Law 820 of 2003, is directly related to the behavior of the Consumer Price Index (CPI) of the previous year.
According to data from the National Administrative Department of Statistics (DANE), inflation in 2024 closed at 5.2%.
This data sets the maximum limit for the increase in rents in 2025. However, this increase can only be applied once 12 months have passed since the signing of the lease contract or since the last adjustment.
How the increase is calculated
Calculating the new rental value is simple:
- Multiply the current rental value by the CPI percentage (5.2%).
- Divide the result by 100.
- Add this value to the current monthly fee.
For example, if you are currently paying $2,000,000 in rent, the maximum allowable increase would be $104,000, which would bring your monthly total to $2,104,000.
Important Considerations
- Deadline for the Increase: The adjustment can only be made when the contract reaches 12 months. If you signed your contract in March 2024, the increase may be applied from March 2025.
- Formal Notification: The landlord is obliged to inform the tenant in writing of the amount of the increase and the date on which it will take effect.
- Increase Cap: In addition to the CPI limit, the increase cannot exceed 1% of the commercial value of the property, as stipulated by Fedelonjas.
And the administration?
In residential complexes, the administration fee is not directly linked to the CPI. Its adjustment depends on the decisions of the Assembly of Owners, in accordance with Law 675 of 2001. Therefore, the increase may vary depending on the approved budget.
Market Context
Rentals represent a significant part of the economy in Colombia. According to Fedelonjas, more than 40% of Colombian households live in rent, with a concentration in strata 1, 2 and 3. The rental phenomenon continues to grow, influenced by urbanization and generational preferences, Valora Analitik said.
In 2025, with lower inflation compared to 2024, the impact of the adjustment in rents is expected to be more moderate, reducing pressures on the general CPI.
Please note!
If you live in a rental, make calculations based on the CPI of 5.2% to predict your expenses. Remember that the landlord must comply with the times and procedures stipulated by law to make any adjustments.
This way, you will be able to better manage your budget in the face of this year’s financial challenges.
#IPC | In December 2024, the annual variation of the #IPC was 5.20%.
📌The monthly rate was 0.46% pic.twitter.com/QZ3KQh5fMj— DANE Colombia (@DANE_Colombia) January 9, 2025
