Indexing the rent: when, how, how much

Indexing is not a rent increase

Indexation is not a revision. It does not reward works, it does not track the market: it simply preserves the purchasing power of the agreed rent by tying it to price movements. The base rent never changes; only the amount payable is recalculated each year, starting from that base rent.

As a rule, three cumulative conditions:

The formula

New rent = base rent × new health index / starting health index

• Base rent: the rent agreed at signature, excluding charges. Not last year's indexed rent. You always restart from the original rent, otherwise indexation would compound on itself.
• Starting index: the health index of the month preceding the month of signature.
• New index: the health index of the month preceding the anniversary of the lease's commencement.

The health index is the consumer price index stripped of certain products (alcohol, tobacco, petroleum products). It is published monthly by the FPS Economy — that is where the exact value comes from, not from a random online calculator.

A worked example

Lease signed in May, commencing 1 June. Base rent: EUR 900 excluding charges. Starting index: April's, in the year of signature. On 1 June of the following year, you take the health index of May of that year.

If the starting index is 128.50 and the new index 131.60:

900 × 131.60 / 128.50 = EUR 921.71

About EUR 22 more per month. Two years later, you will again start from EUR 900 and from the April index of the signature year — never from EUR 921.71.

(The figures above are illustrative: consult the actual indices published by the FPS Economy.)

When? Once a year, on the anniversary

Indexation may occur only once a year, at the earliest on the anniversary of the lease's commencement. Not on the signature date, not on 1 January: on the commencement date. A lease that started on 15 September is indexed from 15 September each year.

It is not automatic — and retroactivity is capped

This is the rule landlords discover too late: indexation must be requested in writing. Until a request has been sent to the tenant, the indexed rent is not owed. And when the request arrives late, its retroactive effect is capped: it reaches back only over the three months preceding the month of the request.

A landlord who "forgets" to index for four years and then claims the whole backlog runs straight into that cap. He can index going forward and recover at most three months. The rest is lost.

Landlord's tip: set an annual reminder a week before the anniversary and send a plain letter (or a written, dated message) stating the base rent, the starting index, the new index, the calculation and the new amount. A tenant accepts an indexation that is explained; he contests one that lands without justification.

Tenant's tip: redo the maths. The most frequent errors are indexing from the already-indexed rent (instead of the base rent) or using the wrong month's index. Both inflate the figure.

The warning that matters: the EPC can limit indexation

Since the energy crisis, all three Regions have adopted measures tying the possibility of indexing rent to the dwelling's energy performance, as certified by the EPC/PEB. The logic is the same everywhere:

• a well-rated dwelling remains normally indexable;
• a poorly rated dwelling sees its indexation reduced;
• a very poorly rated dwelling may not be indexable at all until it is renovated or a new certificate is issued.

However, the labels concerned, the percentages applied and the duration of these measures are not the same across the Regions, and several of these schemes were introduced temporarily and then extended, amended or made permanent. We therefore reproduce no scale of rates here: an out-of-date scale is worse than none.

What to do, concretely:

Note also: several Regions make indexation conditional on a written and registered lease. One more reason not to neglect registration — which is free.

What indexation is NOT

• Rent revision: it requires the parties' agreement, or a decision of the justice of the peace, within precise time windows (generally at the end of a three-year period) and on limited grounds (new circumstances, works that raised the rental value). It is not the annual indexation.
• A charges increase: provisions may move with real costs; that is a wholly different mechanism, unrelated to the health index.
• A new rent imposed on renewal: a renewed lease continues on the same terms. It is not an opportunity to raise the rent.

In summary

Where Domilinko fits in

Domilinko requires the energy class in every listing: a listing without an EPC/PEB is not published. So from the moment the property goes on the market, you know its label — and so does the tenant. The platform's timestamped messaging is a useful written trace for the indexation request.

For long-term rentals, however, Domilinko does not collect the rent and does not index it for you: that is a direct relationship between landlord and tenant. The platform offers no rent-default insurance, no payment guarantee and no delegated property management.