I. What is Rent Increase Rate?
Rent increase rate is the rate used to determine the rent to be paid in the new rental year in residential and roofed workplace rental agreements.
There are some legal limitations in determining the rent increas e rate. The law prevents the determination of an exorbitant rent increase rate by introducing regulations in favor of the tenant who wants to meet their basic accommodation or workplace needs.
II. How is Rent Increase Rate Determined Under Turkish Law?
It would not be correct to act by heart in determining the rent increase rate. Because, whether the rental agreement is written or not in determining the rental increase rate varies depending on how the rental increase rate is determined in the rental agreement.
Legal restrictions on the rent increase rate are set for “residence and roofed workplace lease agreements”. Accordingly, these limitations may not apply to rental agreements that are not residential or do not have a roofed workplace, such as an open car park.
For detailed information about the rental agreement, you can review our “Residential Lease Agreement Under Turkish Law” article.
III. Legal Rent Increase Rate Calculation
According to the Turkish Code of Obligations, the agreement between the parties regarding the rental price to be applied in the renewed rental period; “It is valid provided that it does not exceed the rate of change according to the twelve-month averages in the consumer price index in the lease year.” The “consumer price index” specified in the article of the law is briefly expressed as CPI and is generally written in this way in contracts. The CPI is determined every month by the Turkish Statistical Institute and the rates are published on the website.
Calculation of the legal rent increase rate is calculated according to the twelve-month monthly average increase from the month in which the lease agreement was renewed.
If there is no Written Rental Agreement between the Parties or the Rate is not Written in the Written Rental Agreement; How is Rent Increase Rate Determined?
The lease agreement does not have to be in writing for it to be valid. For this reason, even if a written lease agreement is not made between the parties or the contract is lost, the lease and contractual relationship between the parties continues. For this reason, the limitations imposed on the rent increase rate by the Turkish Code of Obligations also apply to verbal lease agreements where the lease agreement is not written.
If there is no written lease agreement between the parties or if no rental increase rate has been determined in the written lease agreement; The lessor must first file a “lease determination case” in the Civil Court of Peace to determine the “rent increase rate” based on the second paragraph of Article 344 of the Turkish Code of Obligations. Otherwise, there is no right to increase the rental price directly in the renewed rental period. In such a case, the tenant does not have to increase the rental price.
If the Rent Increase Rate is Determined with a Written Rental Agreement
If the rent increase rate is determined in the lease agreement, the first thing to consider is whether the rate determined as the rent increase rate is higher or lower than the legal rate.
In the written lease agreement, the rent increase rate is determined more than the legal rate, and even if it is accepted by the tenant, making a rent increase more than the legal rent increase rate (Twelve-month CPI average) constitutes a violation of the mandatory provision of the law and is invalid. ln this case, the tenant can only be held responsible for increasing the rental price over the legal rate.
In the determination of the rent increase rate lower than the legal rate, the low rate in favor of the tenant is valid. For example, if it is written in the rental agreement that “the increase rate will be 10% in each new rental period”, the tenant will not be asked to increase the rent at a legal rate exceeding 10%.
It is seen that terms such as PPI and WPI are often included in lease agreements. Until 17/01/2019, the legal rent increase rate in the Turkish Code of Obligations was the PPI, that is, the producer price index. However, with the amendment made in the law, it was brought into its current form. WPI was the wholesale price index. WPI is not an index published since 2014. References to WPI are determined according to the domestic producer price index called D-PPI. In case the rent increase rates in the form of PPI or WPI are written in this way in the written lease agreements; These rates should be calculated and the CPI in favor of the tenant or the rent increase rate should be calculated in this way, whichever is in favor of the specified rates.
IV. Limiting the Rent Increase Rate in Residental Rents to 25% by Law – 11 June 2022 – 2 July 2024
According to the New-Temporary Legal Regulation, the rate of increase in residential lease agreements renewed between 11 June 2022 and 1 July 2023 is not according to the “CPI”; It is set at 25%. For this reason, if the rate of increase in the rental agreements to be renewed between 11 June 2022 and 1 July 2023 is not less than 25% in the rental agreement, the increase rate will be 25%.
The temporary arrangement was extended from July 1, 2023 to July 2, 2024, and the rate of increase in lease agreements renewed during this period was limited to 25 percent from 25 percent.
For example, even if there is a twelve-month average in the Consumer Price Index as the rent increase rate in the rental agreement, the increase rate in the new term rental agreement will be 25%. However, if the increase rate is determined as 10% in the lease agreement, a twenty-five percent increase in rental price cannot be requested from the tenant.
V. Enforcement Proceedings and Eviction Procedure Against the Tenant Who Doesn’t Increase Rent
Taking into account all the above-mentioned issues, the tenant has to pay the rent by increasing the rental amount as of the renewed rental period, after the rate of the rent increase has been determined clearly. It is not necessary to make a new written lease agreement with the tenant in each renewed period. In the same way, there is no need for a written commitment or contract on how much the new rental price is.
The tenant should calculate how much the new rental price should be and pay the rent by increasing it automatically within the monthly rental payment period specified in the rental agreement (for example, between the 1st and the 5th of each month, or until the 15th day at the latest, until the end of the month). must. In the event that the old rent is paid without increasing the rent, an execution proceeding without a verdict (Example No: 13) with an eviction request based on the “non-payment of the rent fee” can be initiated against the tenant without the need for a further period, a written warning or a notice.
In case the tenant pays the previous rent without increasing the rent, he/she must pay the remaining rent difference within 30 days at the latest after the payment order is sent to him/her. Otherwise, the lessor may file an eviction lawsuit based on non-payment of the rent.
The Lessor may request the Lease Fee for 5 Years Backwards for the Missing Rental Balance according to the Rent Increase Rate.
In the event that the lessee makes a rent increase less than the increase rate determined in the contract, the lessor has the right to demand the underpaid rent for 5 years (timeout period) retrospectively. In such a case, the lessee must prove in writing that the rent increase rate is understood to be lower than the one specified in the contract. Verbal rent increase agreements carry a lot of risk against the tenant. Therefore, our advice to tenants; It is the payment of the new term rental fee by calculating the increase in penny to cents, without rounding, as specified in the lease agreement (not exceeding the legal rate).
Let’s give an example of this situation as follows; Let’s assume that there is a provision in the lease agreement for the legal increase of the new period rental prices between the lessor and the lessee. Accordingly, while the current rent of the tenant is 3.000-TL, in case the legal rate is 30%, the new period rental price will be 3.900-TL. The lessor and the tenant talked among themselves that the rental price should be paid as 3.750-TL, and the tenant paid this rent for 1 year. At the end of 1 year, the lessor may request eviction by subjecting the rent balance of 150-TL per month to the enforcement proceedings. In such a case, if the tenant does not have WRITTEN evidence that the rental price has been determined as 3.750-TL, he will have to pay the rent. Otherwise, the lessor wins the eviction lawsuit based on non-payment of the rent.
The statute of limitations for receivables arising from lease agreements is 5 years. For this reason, the lessor, considering that the lessee does not have a written agreement and document, will be able to request the rent increase balances for 5 years.
In the decision of the General Assembly of the Supreme Court of Appeals dated 09/02/2005, numbered 2005/3-23 and 2005/48; “…The fact that the lessee pays by increasing the rent and the lessor accepts it without putting forward any terms and conditions will not cause the loss of this right to file a lawsuit that has arisen and still exists, and it is not sufficient to accept the existence of a lease agreement concluded with new conditions between the parties…” With this provision, it has been established that the lessor who accepts the rent increase does not mean that the lessor has implicitly accepted the increase in the rental prices, and that the remaining rents must be paid.
Do you need legal assistance regarding tenant rights, tenancy disputes or litigation? Clear your doubts.
Rental agreements are seen as a procedure in our country due to lack of knowledge or carelessness in legal matters. In fact, we often come across a rental relationship without a written lease agreement. However, lease agreements are contracts that bind both parties and impose mutual obligations.
The fact that people act without knowing the rights and obligations arising from the rental agreements that are frequently made in order to meet the basic needs of shelter or workplace causes very serious problems. Especially in countries where inflation is high, there is a confrontation between the lessors and the tenants based on the precedent rental prices, and the parties end up in the corridors of the courthouse.
Lawyers of BAL Law Firm provide legal services in all disputes arising from residential and roofed workplace lease agreements. In particular, disputes related to rent increase rates, tenant eviction, eviction lawsuits based on eviction notice, tenant’s rights, eviction lawsuit due to non-payment of rental fees, collection and enforcement proceedings, eviction lawsuit due to new owner’s need, receivables arising from past rental fees, rental adaptation lawsuits, rental We have very competent knowledge and experience on disputes such as settlement cases. For more information; Landlord Tenant Attorney in Turkey Legal Service
Memduh Remzi BAL
Lawyer / Attorney in Turkey
Send Mail : info@ballawyer.com
Call Us : +90 212 909 86 34
