Rent Increase Cap in Turkey: TBK Art. 344 and the CPI Rule

Disputes over rent increases are among the most common sources of conflict in Turkish landlord-tenant relationships. Article 344 of the Turkish Code of Obligations (TBK) places a ceiling on how much rent may be increased in any given year and gives courts authority to reset rent after five years. For foreign landlords and tenants unfamiliar with these rules, the consequences of misapplying them can be significant.

The Core Rule: CPI Cap

Where the Parties Have Agreed on an Increase Rate

Under TBK Art. 344/1, any agreement between the parties on a rent increase rate for a renewed lease period is capped at the Consumer Price Index (CPI) increase for the preceding lease year. If the parties contractually agree to a higher rate, the excess is simply void — the CPI rate applies automatically.

Example: A lease agreement specifies a 40% annual increase. If the CPI rose by 35% in the preceding year, the permissible increase is 35%; the contractual 40% is unenforceable.

Where No Increase Is Agreed

If the lease contains no provision on increases (TBK Art. 344/2), and the parties cannot reach agreement, either party may apply to court. The court sets the increase at a level it considers equitable — but it may not exceed the preceding year's CPI rate.

The Five-Year Rule

TBK Art. 344/3 introduces a more significant power after five years: once a lease has been running for five years (or is renewed after five years), the court determines the new rent. The court takes into account:

• CPI movements,
• The condition of the leased property,
• Comparable market rents in the area.

This means a landlord whose rent has lagged far behind market value can apply for a court-determined reset after the five-year threshold is crossed — even if the tenant is unwilling.

Foreign Currency Leases

Where rent is denominated in a foreign currency, no change in rent is permitted for the first five years (TBK Art. 344/4). After that, the rules in paragraphs 1 and 3 apply. Note that foreign currency rental agreements in Turkey are also subject to currency control regulations.

Notice Requirement for Increases

The right to claim an increase does not apply automatically. TBK Art. 345 requires that any demand for a rent increase be notified within the current lease year before the renewal date takes effect. A landlord who misses this window may lose the right to insist on the higher rate for the upcoming period.

The Temporary 25% Cap and Its End

In mid-2022, the Turkish legislature introduced a temporary cap of 25% on residential rent increases, in response to accelerating inflation. This measure was extended and finally expired in mid-2023. Since then, the standard CPI-based cap under TBK Art. 344 has been fully restored.

Disputes arising from lease renewals made during the temporary cap period — particularly questions about whether supra-cap agreements are void and how the transition back to normal rules operates — have generated ongoing litigation in Turkish courts.

How to Challenge an Unlawful Increase

Court Application

A tenant subjected to an increase that exceeds the CPI cap may apply to the magistrates' court to have the excess declared void and the lawful rate determined.

Protest Payments

Practically, tenants who dispute an increase should pay the amount they regard as lawful and document their position in writing. This creates a contemporaneous record and avoids the risk of a landlord initiating eviction proceedings for unpaid rent.

Frequently Asked Questions

Can the landlord apply any rate they wish if the tenant agrees in writing?
No. Even a written agreement cannot override the CPI cap. The excess is void by operation of law.

Which CPI rate applies?
The twelve-month CPI figure published by the Turkish Statistical Institute (TÜİK) for the month immediately preceding the lease renewal date is used.

From when does the five-year period start?
From the date the original lease was signed, not from the date of any renewal.

Must an increase clause be in writing?
Not strictly required by law, but a written clause in the lease avoids evidential disputes. Best practice is always to include one.

Common Disputes in Practice

• Wrong index applied: landlords using construction cost index (ÜFE) or currency depreciation as the basis, rather than CPI,
• Incorrect calculation period: taking the CPI for the wrong month,
• Cumulative increase claims: seeking to recover increases from previous years where no increase was applied — courts generally reject this,
• Tacit renewal disputes: disagreements over which rate applies when a lease is silently renewed.

Legal Assistance

Rent increase disputes require precise calculation, awareness of current case law, and in many cases urgent action to protect existing rights. MONA HUKUK advises landlords and tenants in Antalya on rent increase issues — from reviewing lease clauses through to court proceedings.

Contact us at contact@monahukuk.com or call +90 (242) 606 14 32 to schedule a consultation.