Rent Increases and Rent Determination Actions in Türkiye: The CPI Cap and the Five-Year Rule

Rent increases are among the most common sources of disputes between tenants and landlords. Article 344 of the Turkish Code of Obligations sets out in detail how rent may be changed in residential and roofed commercial leases.

Cap for renewed lease periods: CPI

Under Article 344(1), the parties' agreements on rent for renewed lease periods are valid provided that they do not exceed the change in the twelve-month average of the consumer price index (CPI) in the previous lease year. This also applies to leases of more than one year. If the contract provides for a higher increase, it is valid only up to the CPI rate.

If the parties have not agreed on an increase, the rent is determined equitably by the judge, taking into account the condition of the property, again without exceeding this rate. The temporary twenty-five per cent cap once applied to residential rents has ended; today the twelve-month CPI average applies.

Re-determination after five years

Under Article 344(3), whether or not the parties have agreed, for leases longer than five years or renewed after five years, and at the end of each subsequent five-year period, the rent for the new lease year is determined equitably by the judge, taking into account the CPI change, the condition of the property and comparable market rents. Rents can therefore be brought closer to market levels after five years. The rent so determined may then be increased in subsequent years within the CPI cap.

Foreign-currency rent

Where rent is agreed in foreign currency, subject to the legislation on the protection of the value of the Turkish currency, the rent cannot be changed until five years have passed, although Article 138 on excessive difficulty of performance remains applicable. After five years, paragraph 3 applies, taking into account changes in the value of the currency.

Rent determination action and timing

An action to determine rent is known in practice as a "rent determination action" (kira tespit davası). Under Article 345, it may be filed at any time; however, the date from which the rent set by the court applies depends on when the action is filed:

• If the action is filed at least thirty days before the start of the new lease period, the determined rent binds the tenant from the start of the new period.
• If the landlord has notified the tenant in writing within that period that the rent will be increased, the determined rent also applies from the start of the new period provided the action is filed by the end of that new period.
• If the contract provides for a rent increase in the new period, rent determined in an action filed by the end of the new period also applies from its start.

If these conditions are not met, the determined rent generally applies from the following lease period. Timing of notice and filing is therefore important.

Mediation first

Under Article 18/B of the Mediation in Civil Disputes Law No. 6325, applying to a mediator before filing suit is a precondition for disputes arising from lease relationships, except eviction through enforcement proceedings without judgment. Rent determination actions fall within this scope. If agreement is reached, an annotation of enforceability must be obtained from the civil court of peace.

Practical tips

• Before requesting an increase, check the twelve-month average CPI change announced by the Turkish Statistical Institute for the relevant month.
• Communicate your request or acceptance in writing by a provable method.
• For leases reaching five years, gather information on comparable rents (listings for similar properties, contracts) in advance.

This article is for general information purposes only and does not constitute legal advice.