New regulation for the rental market from the government: Housing mobilization begins

While the increase in rental prices continues to be one of the biggest problems for the Turkish economy, the government is taking new steps to combat unregistered rentals and bring prices under control.

The consecutive announcements made by the Central Bank of the Republic of Turkey (TCMB) and the Ministry of Treasury and Finance regarding the rental market indicate that significant changes are on the horizon for the sector.

Minister of Treasury and Finance Mehmet Şimşek announced that a comprehensive rental database is being created for the first time in Turkey.

Rental agreements will be recorded using land registry and MERNIS (Central Population Administration System) data. This system aims to both ensure transparent determination of rental prices and prevent unregistered income.

RENTAL AGREEMENTS MOVED TO E-DEVLET

One of the most notable steps taken by the government has been the registration of rental agreements via e-Devlet. Thanks to this application, both landlords and tenants will be able to secure their legal rights by entering rental amounts and contract details into the government's official system.

According to the statement by Minister of Treasury and Finance Mehmet Şimşek, more than 11,600 rental agreements have been moved to the e-Devlet system so far, and 38,000 tenants have entered their rental information into the system.

It was stated that inspections will be tightened if landlords fail to file tax returns, and it was announced that not only the year 2024 but the last 5 years will be examined retroactively.

INSPECTIONS ARE INCREASING

The Ministry is also conducting intensive work on the taxation of rental income. Minister Şimşek announced that 425,000 residences were inspected last year and 376,000 of them filed tax returns for the first time.

In this context, inspection teams went door-to-door to identify tenants and warned landlords to declare their rental income. Şimşek stated, "We sent messages to landlords, we said 'file a tax return.' If a return is not filed, we initiate an inspection."

RENTAL INFLATION IS STILL HIGH

In the January Price Developments Report published by the Central Bank of the Republic of Turkey (TCMB), it was emphasized that despite the slowdown in rental inflation, the level remains high.

On an annual basis, rental inflation showed a limited decline, falling to 100.64%.

TCMB Governor Fatih Karahan also stated in the latest Inflation Report that rental increase rates have slowed down but the decline will not be very rapid. Karahan said, "Services inflation is gradually falling, but stickiness in rental prices will continue."

GOVERNMENT MOVE FOR HOUSING MOBILIZATION

Seeking to produce a solution to the rental crisis, the government is launching a mobilization to increase housing supply in order to lower rental prices in the long term. Minister of Treasury and Finance Mehmet Şimşek stated that rental prices will be brought under control by increasing housing production over the next few years.

Şimşek said, "We hope to bring rents under control over the next few years through a housing mobilization, by increasing housing supply."

WARNING TO LANDLORDS

With the government increasing tax audits, serious sanctions are expected to be applied to landlords who earn unregistered rental income. Mehmet Şimşek said, "We know the property owner, the tenant, the kinship ties, and the comparable rents in the region. If a tax return is not filed, we will conduct a 5-year retroactive review."

In particular, moving rental agreements to the e-Devlet system is of great importance in terms of making rental income transparent and increasing taxation. These steps by the government aim to prevent tenants from facing high prices and to minimize the informal economy.