Mexico City Caps Rent Hikes to Fight Gentrification

Mexico City, Mexico — Mexico City's Head of Government, Clara Brugada Molina, announced "Bando 1: For a Livable, Affordable City with Local Identity and Roots," a set of 14 actions aimed at controlling the rental market and preventing the displacement of residents in central areas affected by gentrification.

Key Measures to Stabilize Rental Prices

The plan includes capping rent increases to the annual inflation rate, as established in Article 2448 of Mexico City’s Civil Code. The proposal ensures no increase exceeds the previous year’s inflation rate.

Additionally, the government will create a Reasonable Rental Price Index for areas designated as "real estate tension zones," factoring in variables such as location, cadastral value, and income-to-expense ratios.

New Protections for Tenants

In response to soaring housing prices and abusive leasing practices, the city will establish a Tenants' Rights Ombudsman—a public body with mediation and sanctioning powers to address unfair practices or illegal evictions.

A Fair Rents Law will also be introduced to ensure price stability and balance the rights of landlords and tenants.

Additional Initiatives

Other measures in the package include:

• Strict regulation of short-term rental platforms like Airbnb.
• Expansion of public rental housing programs.
• Incentives for traditional businesses to preserve social fabric.
• Creation of a Land and Housing Observatory.
• A master plan for territorial interventions.
• Support for community roots in affected neighborhoods.

Implementation and Funding

The plan will initially roll out in boroughs such as Cuauhtémoc and Miguel Hidalgo, where rents have surged by up to 25% and recent protests have erupted.

By 2025, the city government will allocate approximately 9 billion pesos to the project, with a goal of implementing 200,000 housing actions by 2030.

Public Participation

The announcement included calls for open forums to incorporate input from residents, academics, developers, and advocacy groups in shaping and executing the policies.

The overarching objectives are to curb speculation, protect traditional neighborhoods, guarantee dignified housing, and preserve the cultural identity of affected areas.

The initiative seeks to transform urban policy into a socially conscious, community-driven model while preventing the displacement of families and the erosion of local character in the capital’s historic districts.