Property owners turn to short-term rentals amid rent cap

Gülistan Alagöz - ISTANBUL

Property owners are increasingly turning to short-term leasing as a result of the recent extension of the annual rent increase cap, as the figures fall far below market value.

Due to the rapidly increasing rents in recent years, the rent cap was put into effect in June 2022. Accordingly, landlords are allowed to raise the rental prices by a maximum of 25 percent during the contract renewal period until July 2, 2024.

While many tenants were satisfied with the new regulation, property owners turned to alternative ways. Some landlords now prefer to keep their houses completely empty, while others found the solution in short-term renting.

With short-term renting, property owners, who are now able to determine a new price for each rental, both avoid the 25 percent rent cap and avoid dealing with evictions.

On the other hand, short-term rentals make it more difficult for tenants looking for a long-term home.

The short-term rental sector, previously popular in touristic hotspots, has now become much more widespread. Property owners are looking for short-term tenants through professional companies or real estate offices that rent their properties on a commission. In addition to daily and weekly rentals, monthly, quarterly and semi-annual options are also offered.

Mustafa Hakan Özelmacıklı, vice president of Entrepreneur Real Estate Agents Association (TÜGEM), said that the number of daily rental ads across the country has increased by 50 percent in the last two years.

“Due to the insufficient housing options, the growth in this area is a negative situation for those looking for a rental house. For this reason, there were countries in the world that banned Airbnb. There is no ban for the rapidly growing short-term rental sector in our country, but strict supervision is necessary. Although it is compulsory, unfortunately, we know that houses are rented without IDs. Those who do the job in accordance with the legal requirements are only around 10-15 percent.”