It is usual to include a clause in a lease whereby the rent is increased each year.
Note: generally, the clause providing for the indexation of the rent is applied automatically, without the lessor having to ask the tenant to increase the rent.
When the rented property is the tenant's principal residence, the law requires the use of the Index of Reference of Rents (IRL), published by INSEE. This index is applied for the most frequent rental contracts:
The rent increase takes place every year, on the agreed date, or on the anniversary date of the lease.
The annual rent increase cannot exceed the variation of the Index of Reference of Rents over one year.
The index to be taken into account is :
When the rented property is not the tenant's main residence, it is possible to freely choose the index used to index the rent. It can be the IRL but also the Construction Cost Index (ICC), also published by the INSEE.
Note : Temporarily, with regard to inflation, the rents revised according to the indices ranging from the 3rd quarter of 2022 until the 2nd quarter of 2023, will be capped at a variation of 3.5%. Except for the overseas departments and regions, where the variation is limited to 2.5% and within the limit of 1.5% for the Corsica community.
It is necessary to mention in the lease which index is used to calculate the indexation.
Note: the index chosen must be related to the contract. These two indices, ICC or IRL, are valid for a residential lease that is not the tenant's main residence.