Attention landlords and tenants! Notable 'rent cap' message from the Central Bank

The rent cap application of 25 percent on residential rents will expire on July 2, 2024.

The regulation, which came into effect for one year in 2022, was extended for another year in 2023. Tenants and landlords are wondering whether the rent limit will continue.

The Central Bank of the Republic of Turkey (TCMB) has published the summary of its Monetary Policy Committee (PPK) meeting dated April 25.

"WILL BE LIFTED"

In the report included in the PPK meeting summary, the following statement was used: "The impact of the regulation limiting rent increases to 25 percent being lifted in the near future on rent inflation will also be closely monitored."

The following was noted in the Monetary Policy Committee meeting summary regarding the subject:

"While annual rent inflation continues to hover at a high level, leading indicators monitored through Retail Payment System (PÖS) microdata suggest that the slowdown in the rent increase rate, which began in February, will continue in April. On the other hand, the annual increase in housing prices fell to 58.3 percent as of February, remaining below the annual consumer inflation, and seasonally adjusted data indicated that the monthly increase in this item has also slowed significantly in recent months. This situation in housing prices is considered a factor that will limit rent inflation in the coming period. On the other hand, the impact of the regulation limiting rent increases to 25 percent being lifted in the near future on rent inflation will also be closely monitored."

IF THE LIMIT IS LIFTED, WHAT WILL THE INCREASE RATE BE?

If the application is not continued or if no new limit is introduced, rent increases will be calculated based on the 12-month inflation average, as was the case previously.

According to the April inflation figures announced today, the rate to be applied in May was 59.64 percent.

In other words, if there were no 25 percent limit this month, 59.64 percent would have been applied as the ceiling rate.

News Source: 12punto