Rent Updates in Portugal: What Changes in 2026?
The annual rent update coefficient has a direct impact on the rent amounts that may be charged under both urban and rural tenancy agreements in Portugal.
Following the publication of Official Notice No. 23174/2025/2, which establishes the coefficient applicable in 2026, it is important to clarify the legal framework, how the update mechanism operates and the practical implications for both landlords and tenants.
Background
On 19 September, Official Notice No. 23174/2025/2 was published, setting the annual rent update coefficient applicable to urban and rural lease agreements during 2026.
Under Portuguese law, the responsibility for calculating the annual rent update coefficient rests with the National Statistics Institute (INE).
For 2026, the coefficient has been set at **1.0224**, corresponding to an increase of **2.24%** compared with the current rent value.
How the Rent Update Coefficient Works
As a general rule, landlords and tenants are free to agree in writing on how rent reviews will be carried out during the term of the lease.
Where no specific contractual provision exists, the default legal framework applies.
Under this framework:
- Rent may be updated annually according to the officially published coefficient;
- The first update may only be applied one year after the beginning of the tenancy agreement;
- Subsequent updates may only occur one year after the previous increase;
- The landlord must notify the tenant in writing at least 30 days in advance, indicating both the applicable coefficient and the resulting new rent amount;
- Failure to update the rent in a particular year does not necessarily prevent future increases, provided that no more than three years have elapsed since the update could first have been applied.
For this reason, the annual publication of the official coefficient is particularly relevant whenever the tenancy agreement does not establish a different review mechanism.
What Does the 2026 Increase Mean in Practice?
For 2026, the coefficient has been fixed at 1.0224, representing a maximum increase of 2.24%.
In practical terms, for every €100 of current monthly rent, the rent may increase by up to €2.24.
For example:
- Current monthly rent: €1,500
- Maximum updated rent for 2026: €1,533.60
Conclusion
After the reduction observed between 2024 and 2025, when the coefficient decreased from 1.0694 to 1.0216, the coefficient for 2026 records a modest increase, rising from 1.0216 to 1.0224.
Landlords wishing to update rent values should ensure that tenants receive written notification at least 30 days before the increase takes effect, specifying both the official coefficient and the resulting rent amount.
Tenants should also be aware that any rent increase based on the statutory update mechanism cannot exceed the limit established by Official Notice No. 23174/2025/2.
Source: RFF Lawyers
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