The annual change in the reference rent index (IRL) for the second quarter of 2023, published by INSEE on Thursday, is still capped at +3.5% for mainland France and will remain at this level for another 12 months given the extension of the rent shield until the first quarter of 2024. The increase is also capped over the same period at +2.5% for the overseas departments and regions and at +2% for Corsica.
+3.5% with shield
Given this cap at 3.5%, its value this quarter stands at 140.59 for mainland France.
This index, in principle calculated from inflation excluding tobacco for the last 12 months, serves as the basis for the annual rent review. Concretely, on each anniversary date of the lease, the rent can be revised upwards according to the last known IRL. Thus, this publication concerns leases that refer to the IRL of the second quarter, i.e. leases whose anniversary date is generally between mid-July and mid-October, knowing that the next IRL will be released on October 13th.
+6.13% without shield
Without the capping measures of the law on the protection of purchasing power enacted last summer and extended a few weeks ago, the IRL for the second quarter of 2023 would have seen an increase of 6.13% over one year. As an indication, the evolution of the IRL would have stabilized after a peak of 6.26% in the previous quarter and respectively +5.69% and +4.78% previously in the absence of a shield.
Example of revision
The revision is made on the rent excluding charges. A tenant with a rent of €1,000 (including €80 charges) will, for example, see his bare rent increase from €920 to €952.2 (+3.5%), i.e. €1,032.2 charges included.
+3.5% for the next three quarters
The rent shield will still apply for the next three IRL publications (third quarter 2023, fourth quarter 2023 and first quarter 2024). This cap at +3.5% for mainland France will thus concern rental contracts whose anniversary date extends until mid-July 2024.