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Regional rent increase is coming

Exorbitant rent increases continue to remain on Turkey's agenda. Minister of Justice Bekir Bozdağ had previously announced that there were 3 alternatives regarding rent increases in his statement on the matter. There has been a new development regarding the solution to exorbitant rents. The Ministry of Justice and the Ministry of Commerce have taken action to solve the problem. The focus is on regional increases as a solution to exorbitant rents.

Regional rent increase is coming

Excessive rent increases continue to remain on Turkey's agenda. Minister of Justice Bekir Bozdağ had previously announced that there were 3 alternatives regarding rent increases in his statement on the matter. There has been a new development regarding the solution to exorbitant rents. The Ministry of Justice and the Ministry of Commerce have taken action to solve the problem. The focus is on regional increases as a solution to exorbitant rents. It is planned to sentence those who make unfair profit by imposing excessive rent increases above the market average to one to three years of imprisonment with the amendment in the Turkish Penal Code (TCK). According to the work, those who make excessive price increases in the prices of goods and services in buying, selling, and consuming will also receive penalties. As the decision is planned to bring a prison sentence of more than two years, those suspected of exorbitant rent increases may also be tried and imprisoned.

New formula against exorbitant rent increases!

For some time, there has been a discussion about imposing prison sentences for exorbitant rent increases. Two ministries have taken action to solve the problem. Regional rent increases are being emphasized as a permanent solution to the rent debate. While the extension of the 25% rent increase limit is on the agenda, work is also being done for permanent solutions. The Ministry of Justice and the Ministry of Trade have examined regional average rent increases in Turkey from the past to the present for a permanent solution. Until last year, rent increases were calculated based on the consumer price index (CPI), but exorbitant rent increases had imposed a 25% rent increase limit. The implementation will end on July 1. In regional increases, the aim is to determine the maximum increase for each city in each region.

The inflation of the 7 regions will be evaluated separately

According to the regional rent increase formula, the inflation of Turkey's 7 regions will be evaluated separately, and a limit will be drawn on the rent increase accordingly. The research conducted by the two ministries will be completed soon. Only time will tell if regional increases will be a solution to high rent.

Problems will continue until inflation and the housing supply issue are resolved

TÜGİAD member and real estate consultant Gülcan Altınay, who stated that they anticipate regulations to be made based on the maximum increases within each region, said: "By examining which cities have experienced higher price increases for housing or which regions have lower increase rates, a new balance can be achieved. However, I do not think that new formulas will be very effective as long as the fight against inflation is not resolved and the problem of housing supply is not resolved."

The prices may not decrease, but it is possible to prevent further increases

Gülcan Altınay, emphasizing the important role of social housing projects in increasing the supply of housing, said, "Prices will not decrease with the introduction of new formulas, but the rate of increase can be controlled. According to the average inflation rate this month, the increase in commercial rents should be 70%, while for housing, it is limited to 25% due to the current regulation. The time limit for housing will be extended after July, but the increase rate for commercial rents still continues based on inflation, and commercial tenants are also complaining about this situation. We recommend that a regulation be made for them as well."

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