Starting January 1, 2026, and through December 31, 2026, the maximum rent increase for tenants who pay P10,000 or less each month will be lowered to one percent. This change is designed to offer a vital safety net for families struggling with the increasing cost of living.
The new rate, approved by the National Human Settlements Board (NHSB) through Resolution No. 2024-001, reinforces the State’s commitment to affordable housing and social protection. It restricts the permissible annual increase for the most vulnerable renters and protects low-income groups from unreasonable rent hikes.
The authority for this regulation is derived from the Rent Control Act of 2009 (Republic Act No. 9653), which granted the then Housing and Urban Development Coordinating Council (HUDCC), and now NHSB, through Republic Act No. 11201, the authority to regulate rental rates.
Coverage
This rental cap is for tenants who pay P10,000 or less each month in 2026 and will see their rent go up. It covers private homes like apartments, houses, dorms, boarding houses, rooms, and bedspaces that are used for dwelling purposes.
A landlord cannot impose a rent increase exceeding one percent of the latest rent. However, both landlords and tenants must understand that this new limit applies as long as the unit remains occupied by the same lessee. This ensures tenure security and affordability for existing tenant who choose to renew or continue their lease.
If the rent is already above P10,000 a month, the unit is no longer covered by the cap, so landlords and tenants can negotiate about the rent.
Other conditions
For certain types of dwellings, such as boarding houses, dormitories, and bedspaces, the rule allows only one rent adjustment within the year, regardless of whether the same cap has been reached.
If a residential unit covered by the Act becomes vacant in 2026, the landlord can set a new rental rate for the incoming tenant without being restricted by the rental cap. This is because the new tenant is entering a fresh contract under prevailing market conditions.
Compliance, Dispute Resolution, and Penalties
The NHSB resolution serves as a mandatory regulation, not merely a guideline. Landlords who breach the prescribed rental cap are subject to legal repercussions under the Rent Control Act of 2009.
Tenants who believe their landlord of violating the cap should seek recourse through the local Barangay Justice System. Should a resolution not be reached at the barangay level, the case can be escalated to the appropriate judicial authority.
Landlords found culpable of imposing exorbitant rent increases may face administrative fines ranging from P25,000 to P50,000, imprisonment for a period of one to six months, or both, at the court’s discretion.
In summary, the cap demonstrates the government’s commitment to balancing the rights of property owners to a reasonable return on investment with the fundamental need to protect housing security and affordability for low-income families in the Philippines.
The reduction to a one percent limit, from the maximum allowable increase in monthly rent of 2.3 percent for 2025, is a proactive measure to shield tenants from potential future economic volatility. It provides a buffer for households with limited capacity to absorb rising living costs and prevents landlords from implementing substantial increases.
Rental Cap 2026: Quick Facts
• Effective: January 1–December 31, 2026
• Maximum increase: 1% for rents of P10,000 and below
• Coverage: Apartments, houses, dormitories, boarding houses, rooms, and bedspaces
• Applies only if: The same tenant remains in the unit
• Not covered: Units above P10,000 and vacant units with new tenants
• Special rule: Boarding houses, dormitories, and bedspaces may adjust rent only once in 2026
• Violations: Fines of P25,000–P50,000 and possible imprisonment under RA 9653
Henry L. Yap is an Architect, Fellow of both Environmental Planning and Real Estate Management, and one of the Undersecretaries of the Department of Human Settlements and Urban Development.
#PropertyReportFeature
#FeaturedStory
