1. What is RPI-Based Rent Increase?

The Retail Price Index (RPI) is often used as a basis for calculating rent increases in commercial and residential leases. This method ensures rent keeps pace with inflation.

2. How Does the Calculator Work?

The calculator uses the RPI rent increase formula:

Where:

• Old Rent — Current rental amount (£)
• RPI — Retail Price Index percentage increase (%)

Explanation: The formula applies the percentage increase to the original rent amount to calculate the new adjusted rent.

3. Importance of RPI Calculation

Details: RPI-based adjustments help maintain the real value of rental income over time while providing tenants with predictable, inflation-linked increases.

4. Using the Calculator

Tips: Enter the current rent amount in £ and the RPI percentage increase (without % sign). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the current RPI rate?
A: The RPI rate varies monthly. Check the latest figures from the Office for National Statistics (ONS) website.

Q2: Is RPI the same as CPI?
A: No, CPI (Consumer Price Index) is calculated differently and typically lower than RPI. Many leases specify which index to use.

Q3: Can RPI increases be capped?
A: Yes, many leases include caps (e.g., "RPI or 5%, whichever is lower") to limit excessive increases.

Q4: How often are RPI increases applied?
A: Typically annually, but check your lease terms as frequency can vary.

Q5: Is RPI still used despite being controversial?
A: While criticized, RPI remains widely used in commercial leases and some residential contracts, though some are transitioning to CPI.