Housing Rent Increase Continues With CPI Period Re-Evaluation – Latest Update
Housing rent increases have been a significant issue for citizens over the past two years, with annual increases causing financial strain for many. The existing regulation, which set a 25 percent upper limit on housing rent increases, will come to an end as of July, reverting back to the 12-month CPI average as the ceiling limit for rent hikes.
Treasury and Finance Minister Mehmet Şimşek confirmed that the temporary measure, implemented in response to high inflation rates, was intended for a limited time and will not be extended. Starting tomorrow, the 12-month average from June inflation will determine the maximum rate of increase for housing rents once again.
Following the removal of the restriction, market research conducted by Endeksa revealed that rental house values in Turkey had increased nominally by 265 percent over the past two years, with an inflation-adjusted increase of around 50 percent. The general manager of Endeksa, Görkem Öğüt, expressed optimism that lifting the regulation will bring balance to the market.
However, the end of the 25 percent limit on rent increases has sparked debates and disputes between landlords and tenants, leading to a surge in legal cases. As a result, mandatory mediation before court proceedings has been introduced to alleviate the burden on the judicial system.
Looking ahead, discussions on potential measures to control rent and real estate prices are ongoing, with proposals for higher taxes on multiple property owners and withholding taxes on rental income surfacing. With the 12-month CPI average surpassing 62 percent in May, tenants are bracing for significant rent hikes in the coming months.
Real Estate Law Specialist Lawyer Ali Güvenç Kiraz addressed common concerns regarding the housing rent increase regulations, clarifying key points such as the duration of the 25 percent limit, calculation methods for rent hikes, and procedures for resolving disputes between landlords and tenants.
In conclusion, the lifting of the 25 percent rent increase limit is set to have a ripple effect on the real estate market in Turkey, prompting adjustments in rental prices and shaping future landlord-tenant relationships. As the industry adapts to these changes, stakeholders will need to navigate the evolving landscape of housing rent regulations and practices.
