Increasing the rent
Rent increase clause
A rent increase clause may be included in all tenancy agreements valid until further notice. Nowadays, a fixed-term tenancy agreement for less than three years may also include a rent increase clause. It is advisable for the landlord to include this clause in the tenancy agreement whenever possible. This helps to ensure that the rent is in line with the cost of living.
There are many possibilities to raise the rent but in general, the rent is tied to an index. The most common index is the consumer price index, which reflects the development of the general cost level and thereby provides a hedge against inflation.
Index clause (index increase)
A tenancy agreement must define the index to which the rent is tied and the rent review dates. Usually, the rent can only be increased once a year. In the agreements made by Vuokraturva, the annual rent review date is usually the date on which the agreement is signed. The review index is the last published index point figure and the base index is the last published index point figure at the time of signing the lease. The difference between these two figures indicates how much the rent can be increased.
Statistics Finland publishes the point figure of the consumer price index monthly. The point figure of the previous calendar month is published in the middle of the following month.
More information about the consumer price index and the index figures is available from Statistics Finland at www.tilastokeskus.fi and by telephone 029 551 1000. HERE you can find Statistics Finland’s release that contains information on the latest point figures of the cost-of-living and consumer price indexes and annual change in the consumer price index.
Remember to notify the tenant in writing before putting the increase into effect!