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SubscribeThe legal update coefficient for 2026 has been established by Notice 23174/2025/2 of September 19. Published in the Official Gazette of the Republic of Portugal, the coefficient, as calculated by the National Statistics Institute (“INE”), is set at 1.0224, reflecting a 2.24% increase. Unless the parties to an agreement agree on different criteria, this coefficient applies to all rental agreements for buildings and land.
Mechanism for updating rents
Parties are generally allowed to determine their own conditions for updating rent in their lease agreement. However, in cases where the agreement lacks such provisions or the parties agree otherwise, article 1077 of the Portuguese Civil Code stipulates that:
- rent may be updated annually based on the legal coefficient published by the INE, which reflects the variation in the consumer price index (“CPI”)— excluding housing—for the 12-month period up to August 31 of the previous year; or
- the first update may be claimed one year after the agreement begins and subsequently every year, one year after the last update.
If landlords do not update rents within the required timeframe, they risk losing missed increases. However, they may still apply coefficients in subsequent years, but only within three years of the original due date.
Comparison with previous years
In 2026, the coefficient of 1.0224 (2.24%) is a slight rise from 2025’s 1.0216 (2.16%), though the 2024 coefficient had marked a much sharper increase of 6.94%.
Guidance for landlords
- Landlords seeking to update rents must give tenants written notice at least 30 days in advance. The notice must sate the new rent amount and the coefficient(s) applied.
- Under supplementary legal provisions, rent may be updated only once a year, after one full year has passed since the agreement began or since the last update.
Conclusion
For the 2026 calendar year, rent updates must use the new legal coefficient of 1.0224, a 2.24% increase. Landlords should check their rental agreements for update provisions; if none exist, they must apply the new legal coefficient and notify tenants in writing at least 30 days before the change takes effect.
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