The annual rent review is one of the most profitable routine tasks in property management — and one of the most commonly missed. A late indexation cannot be caught up: since the ALUR law, the review only takes effect from the date it is requested (no retroactive effect), and after one year without notifying the tenant, the year's increase is definitively lost.
The conditions for a review
Three conditions must be met:
- An indexation clause in the lease. Without a review clause, the rent stays fixed for the whole term. The clause normally states the review date and the reference quarter of the index.
- The review date reached. Either the lease anniversary or the date agreed in the clause. The review can only happen once a year.
- A published index. For residential lettings this is the Indice de Référence des Loyers (IRL), published quarterly by INSEE.
The calculation
The formula is simple:
New rent = current rent × (IRL of the reference quarter / IRL of the same quarter a year earlier)
Example: a rent of €850 with a Q2 reference index. If the IRL moves from 140.59 (Q2 2023) to 145.17 (Q2 2024), the new rent is 850 × (145.17 / 140.59) = €877.69.
Two classic traps:
- Using the wrong quarter. The reference quarter is the one written into the lease — or, failing that, the last index published at signature date. Grabbing "the latest published index" at review time is the most frequent error. (And always compare the same quarter year over year.)
- Confusing indexation with rent control. Rent control in high-pressure zones caps the rent at re-letting or renewal — not the annual IRL review during the lease. What can apply, however, is a temporary legislated cap on the IRL itself (like the "rent shield" that limited the index to +3.5% between 2022 and 2024).
F- and G-rated dwellings: indexation forbidden
Since 24 August 2022 (Climat et Résilience law), rents of dwellings rated F or G on the energy performance certificate (DPE) can no longer be indexed in mainland France — nor increased between tenants. Checking the DPE is therefore the first reflex before any review: it is currently the leading cause of unlawful rent reviews in practice. An indexation clause never overrides this prohibition.
The limitation period
The landlord has one year from the review date to notify the tenant. After that, the year's increase is lost. Hence the value of a systematic reminder: across a 200-lease portfolio there are on average 16 indexation windows opening every month.
How Lizops handles it
In Lizops, every lease with an indexation clause surfaces automatically in the "Indexations" queue when its review window opens, with the calculation prepared: starting index, reference index, proposed new rent. The manager checks and confirms — nothing is applied silently, and every confirmed review is written to the audit log together with the generated notification letter.
That is the product's general principle: the work comes to you, ranked by deadline, with the supporting evidence in view before you act.