Rent Determination and the Five-Year Tenancy Period

In leases of residential property or roofed commercial premises, a rent determination action allows the court to set the applicable rent. Completion of five years does not terminate the lease or automatically require the tenant to vacate. The period matters because it changes the criteria used to determine the rent.

Under Article 344 of the Turkish Code of Obligations, increases for renewed terms that have not exceeded five years remain subject to the statutory limits even where the parties have agreed an increase. For leases exceeding five years, or renewed after five years, the court considers the twelve-month average change in the consumer price index, the condition of the property, comparable rents and fairness together.

The five-year period is calculated by reference to the commencement date and renewed rental terms. Asking rents in the same area are not conclusive comparables by themselves. The property's size, age, floor, use, location and physical condition, and whether a purported comparable lease is genuinely applied, may all matter. An expert examination and site inspection may be required.

Although an action may be filed at any time, the rental period from which the determined amount applies depends on the timing rules in Article 345. Filing no later than thirty days before the new rental term, or giving written notice within that period that an increase will be sought, may be necessary for the decision to apply from the beginning of that new term. An agreed renewal-increase clause may produce a different timing result.

Rent determination is distinct from adaptation of a contract due to extraordinary circumstances. Mandatory mediation is required before a lease dispute is brought to court. The lease, payment records, written notices, property characteristics and genuine comparable leases should be assessed together.

This article is for general information only. The legal assessment may differ according to the facts of a particular case.