Rental Increase Rate 2026 — Statutory Cap, Calculation and Disputes

Rent Increase Rate 2026 — Statutory Limit, Calculation and Disputes

The rent increase rate (kira artış oranı) is subject to a statutory ceiling under Article 344 of the Turkish Code of Obligations (Türk Borçlar Kanunu — TBK). In residential and roofed workplace tenancies, it is legally impermissible for a rent increase to exceed a certain rate. As of 2026, the rent increase ceiling applied to residential leases continues to be one of the most significant areas of dispute between landlords and tenants. This article comprehensively covers the statutory basis for the rent increase rate, the method of calculation, temporary regulations, rent determination actions, and the means for resolving related disputes.

What Is the Rent Increase Rate in 2026?

In 2026, the residential rent increase rate may not exceed, under TBK Art. 344, the rate of increase in the producer price index (ÜFE — Üretici Fiyat Endeksi) in the preceding rental year. However, the temporary 25% rent increase cap applicable to residential leases — introduced by Law No. 7409 — expired on 1 July 2024; whether this cap has been extended for 2026 must be checked against current legislation [TO BE VERIFIED].

Under TBK Art. 344/1, agreements between the parties regarding the rent payable in renewed rental periods may not exceed the rate of change based on the twelve-month averages of the consumer price index (TÜFE — Tüketici Fiyat Endeksi) in the preceding rental year. A legislative amendment made in 2019 changed the upper limit, which had previously been set by reference to the ÜFE (producer price index), to the TÜFE (consumer price index) twelve-month average.

In calculating the rent increase rate, the TÜFE twelve-month averages published by the Turkish Statistical Institute (TÜİK — Türkiye İstatistik Kurumu) are taken as the basis. Even if an increase rate is specified in the tenancy agreement, it may not exceed the TÜFE twelve-month average. If no increase rate is specified in the agreement, the rent is determined equitably by the court having regard to the TÜFE twelve-month averages, the condition of the rented property, and comparable rents.

Is the 25% Cap on Residential Rents Still in Force?

The temporary regulation introduced by Law No. 7409 on 11 June 2022, which capped residential rent increases at 25%, was initially set to remain in force until 1 July 2023 and was subsequently extended until 1 July 2024. As of 2026, whether this cap has been extended again must be verified against current legislation [TO BE VERIFIED].

The 25% rent increase cap applied only to residential leases; roofed workplace leases were exempt from this restriction. For workplace leases, the increase rate is, under TBK Art. 344, left to the agreement of the parties, subject to not exceeding the TÜFE twelve-month average. If the cap is lifted or expires, the general rule — the TÜFE twelve-month average — applies to residential leases as well.

During the period in which the temporary cap was in force, rent increases were capped at 25% even where the TÜFE twelve-month average exceeded 25%. This led to income losses for landlords, particularly during periods of high inflation, and contributed to an increase in the number of rent determination actions [TO BE VERIFIED].

How Is the Rent Increase Rate Calculated?

The rent increase rate is calculated using the TÜFE twelve-month averages published by TÜİK. The TÜFE twelve-month average for the month preceding the month in which the tenancy agreement is renewed is used in the calculation. For example, if the agreement is renewed in July, the TÜFE data for June is used as the basis.

The calculation formula is as follows: New rent = Current rent × (1 + TÜFE twelve-month average rate). For example, if the current rent is TRY 10,000 and the TÜFE twelve-month average is 40%, the new rent may be at most TRY 10,000 × 1.40 = TRY 14,000. The parties may agree on a lower increase rate; however, agreeing on a higher rate is legally invalid.

If the tenancy agreement does not specify an increase rate or if the parties cannot agree on an increase, under TBK Art. 344/2 the rent is determined by the court. In such cases the court determines an equitable amount having regard to the TÜFE twelve-month average, the condition of the rented property, and comparable rents. The amount determined by the court also may not exceed the TÜFE twelve-month average.

What Is a Rent Determination Action and When Is It Brought?

A rent determination action (kira tespit davası) is an action brought by either the landlord or the tenant to have the rent re-determined in accordance with current conditions. Under TBK Art. 344/3, in tenancy agreements of more than five years' duration or in agreements renewed after five years, either party may request the court to re-determine the rent.

This provision — known as the “five-year rule” — is intended to prevent the rent in tenancy agreements from deviating excessively from market conditions. While a rent increase within the first five years is limited to the TÜFE twelve-month average, after the expiry of the fifth year the parties may bring a rent determination action requesting the court to determine the rent in accordance with the market rate.

In a rent determination action, the court evaluates objective criteria such as the TÜFE twelve-month average, the condition of the rented property, comparable rents, the location, size, age, and characteristics of the property, and determines the rent. The amount determined by the court may exceed the TÜFE limit because the upper limit no longer applies after the five-year period has expired.

The timing of the rent determination action is also important. Under TBK Art. 345, a rent determination action may be brought at any time. However, if the action is brought at least thirty days before the start of the new rental period, or if written notice is given to the tenant by the landlord within this period, the rent determined by the court takes effect from the start of the new rental period. Otherwise, the rent determination applies from the following rental period.

How Is Comparable Rent Determined?

Comparable rent is the primary benchmark used by the court in rent determination actions to establish the market value of the property. In the examination conducted by an expert, rents of similar properties in the same area are researched, a comparable analysis is made, and the market rent of the property is determined.

Criteria considered by experts in determining comparable rents include: the area and neighbourhood where the property is located; the floor area and number of rooms; the age and condition of the building; the floor level and aspect; access to public transport; proximity to social amenities; the heating system and building quality. Within this framework, comparable rents are established by researching the rents of similar properties.

In Court of Cassation (Yargıtay) practice, at least three comparable properties must be examined when determining the comparable rent. The expert report must set out in detail the addresses of the comparable properties, the rents, and the comparison criteria. The parties may object to the expert report and request a supplementary report or a new expert examination.

What Is the Equitable Reduction and How Is It Applied?

The equitable reduction (hakkaniyet indirimi) is a practice in rent determination actions by which the court makes a certain percentage reduction from the market rent it determines in order to prevent the tenant from being excessively disadvantaged. According to Court of Cassation (Yargıtay) case law, an equitable reduction of between ten and twenty percent is generally applied in the first rent determination action brought after the five-year period has expired [TO BE VERIFIED].

The equitable reduction is not expressly regulated by statute; it is a practice developed by the established case law of the Court of Cassation. The purpose of this reduction is to prevent a tenant who has been living in the property for a long time from being disadvantaged by a sudden rent increase. The rate of the reduction is determined at the court's discretion based on the circumstances of the specific case.

An equitable reduction is not applied in every rent determination action. It is observed that the reduction is small or not applied at all in particular where the rent has not been increased for a long time and has deviated significantly from market conditions. In addition, an equitable reduction is generally not applied in second rent determination actions.

Is Mediation Mandatory in Rent Increase Disputes?

By an amendment made by Law No. 7445, as of 1 September 2023 it has become mandatory to apply to mediation before bringing an action in all tenancy disputes, including rent increase disputes. If no agreement is reached in mediation, the parties may proceed to court.

In the mandatory mediation process, the parties negotiate with a mediator on the subject of the rent increase rate. Mediation proceedings are confidential and the submissions made by the parties during mediation cannot be used as evidence in the court proceedings. The mediation process lasts at most three weeks and may, in mandatory cases, be extended by at most one further week.

If agreement is reached in mediation, the settlement document has the status of a document equivalent to a judgment and is enforceable. If agreement cannot be reached, the parties may bring a rent determination action. If an action is brought directly without first applying to mediation, the court dismisses the action on procedural grounds.

What Points Should Be Borne in Mind Regarding Rent Increases?

The fundamental point that both landlords and tenants must bear in mind regarding rent increases is that the increase rate must not exceed the statutory ceiling. If the increase rate agreed in the contract exceeds the TÜFE twelve-month average, the excess is invalid and the tenant is only obligated to pay the increase within the statutory limit.

For landlords, it is important that the rent increase be communicated in writing and served on the tenant before the start of the new rental period. Stating the statutory basis and calculation method in the increase notice will prevent potential disputes. Tenants should be aware that they have the right to contest an unjustified rent increase and that an action may be brought for repayment of amounts overpaid.

Where the rent is expressed in a foreign currency rather than Turkish Lira, under TBK Art. 344/4 no increase may be made in the rent for five years. After five years have expired, the rent is determined by the court having regard to the change in the foreign currency exchange rate, the TÜFE, and comparable rents.

This content is for general informational purposes only and does not constitute legal advice. Professional legal advice from a qualified attorney is strongly recommended for specific disputes.