HOW MUCH SHOULD THE RENT INCREASE RATE BE ?

The maximum ratio of the amount of rent increase to be applied in the renewal of lease agreements is clearly defined in the Code of Obligations (article 344). Accordingly, the rate of rent increase can be up to the rate of the Domestic Producer Price Index ”YI-PPI”. However, the disclosure by TURKSTAT of four different values of YI-PPI, namely ”Rate of Change According to Twelve-Month Averages”, ”Annual Rate of Change”, ”Rate of Change According to December” and ”Monthly Rate of Change”, creates confusion. According to the established decisions of the Supreme Court, the rate to be applied as the rent increase rate is the ”Rate of Change According to the Twelve-Month Averages of YI-PPI”. This rate is the maximum increase rate that can be applied in the renewal of lease agreements, and if the rent increase rate written into the contract is lower than YI-PPI, the amount of increase written in the contract will apply. Conversely, if a rent increase of more than this rate is determined in the lease agreement, the determined rent increase rate will not be applied because it will be contrary to the mandatory provisions of the code of obligations, the YI-PPI ratio will be applied.