The 25% rent increase cap, implemented on June 11, 2022, due to exorbitant rent hikes, has ended today. How will rent increases be determined in the new period? Are excessive rent hikes expected? Here are the details…
As of July 2, landlords will be able to increase rents based on the 12-month average Consumer Price Index (CPI) as before the cap. The exact rate will be announced tomorrow with the release of the inflation figures. The latest 12-month average CPI announced by the Turkish Statistical Institute (TÜİK) was 62.51%.
WAIT FOR THE CONTRACT RENEWAL PERIOD
According to a report in Hürriyet Newspaper, the end of the increase cap does not mean that all landlords will increase rents in July. Rent increases are done once a year during the contract renewal period. For example, if a tenant’s contract renewal period is in January, there will be no increase in July; the increase will be based on the 12-month average CPI announced by TÜİK at that time.
An important point is that the announced rate is a ceiling increase. The landlord can set a rate below this but cannot exceed it.
MEDIATION REQUIRED BEFORE LAWSUIT
If landlords find the legal rate insufficient, they can seek legal recourse. Tenants who have completed 5 years can file a rent determination lawsuit, while newer tenants can file a rent adjustment lawsuit if there is an “unforeseen reason.” However, mediation is a legal requirement before either lawsuit.
WILL RENTS INCREASE?
The end of the increase cap coincides with a period when students are looking for homes, moving, and marriages are increasing. Due to increased demand, rent prices are expected to rise.
Experts state that the increase cap did not solve the rent problem; instead, it peaked the disagreements between landlords and tenants. They warn about the supply issue. While the homeownership rate is decreasing and the number of tenants is increasing, the number of investors buying homes to rent out is decreasing. Experts say that with decreasing supply, rent prices will rise even more. (ekonomim.com)
