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‘I don’t know what to do’: Soaring inflation and rent prices leave many Turks struggling

FFor decades, Canan lived quite a comfortable life as a school teacher in Istanbul. She even managed to help send her 23-year-old daughter to study abroad and retired earlier this year to live on a monthly pension of around 7,600 Turkish liras (£335), more than enough for pay rent and living expenses – and leave a little for a little more.

The shock came in November, when her landlord demanded she give up her 2,000 lira (£88) a month. She looked for other accommodation in her neighborhood of Bakirkoy, but rents soared from 5,500 lira (£242) for a small space to 11,500 (£506) a month for a flat comparable to hers. She dreads the prospect of moving to a cheaper apartment in another neighborhood and spending most of her money on housing.

“I don’t know what to do,” said the 52-year-old. “I started having health problems because I’m under so much stress. I go to the hospital regularly. I’m seriously hopeless for my life. If I can’t go to the movies or cinema or go on vacation or go out to eat on occasion… »

Turkey is in the grip of an economic crisis in which soaring prices are eating away at the savings and lives of ordinary people. While UK and EU inflation rates are around 10%, Turkey is officially estimated at around 85% in November, while independent analysts believe the rate is much higher.

Nowhere has the impact been stronger than in the housing sector, where an influx of middle-class families fleeing wars and political unrest in Eastern Europe and the Middle East has contributed to a surge rental prices and house values.

According to stats tracker Endeksa, rents have risen 159% over the past year, while house prices have jumped 185%.

In greater Istanbul, rents increased by around 150%, while those in the city of Izmir and Ankara increased slightly. Rents in the resort town of Antalya, home to many people who have moved away due to war in Ukraine and political repression in Russia, have jumped nearly 300%.

According to Turkish law, landlords are only allowed to increase rents by 25% year on year. But many are finding loopholes to get around the rules, or simply using the reduction in maintenance and services to try to force tenants with lower rents to move out so they can raise prices for new tenants.

Despite rental costs, vacant apartments at the lower end of the housing market often lead to bidding wars in Istanbul

(Getty Images)

But the high prices mean that those whose rents are set in the pre-inflation period often refuse to move, which drastically reduces the stock of available housing and pushes prices up further. Despite rental costs, vacant apartments at the lower end of the housing market often spark bidding wars.

“The landlord came here and said you should move out and said he was going to rent it to someone else,” said Hanim, a tenant in a neighborhood on the Asian side of Istanbul. “He said it was too cheap. I said we spent money fixing this place and you can only raise the rent by 25%. He kept saying it was too cheap.

They then agreed to raise the rent slightly, from 1,300 lira to 1,700 lira, but the landlord came up with another tactic. He claimed he had to give the flat to his son and his family, one of the loopholes that allow landlords to evict tenants.

“I said, ‘You should be ashamed. You put us in a terrible position,” she recalled.

The owners note that the inflation crisis has also affected them. Their bills and debts are also rising, forcing them to raise prices.

Cemal Ozcan, of Cihan Real Estate, a brokerage firm in Istanbul, said he himself was forced to pressure a tenant to vacate a building he owns because he needed help. a place for her recently married daughter and son-in-law, who couldn’t find an affordable apartment. He gave his tenant (of seven years) six months to move out. But the tenant found nothing, and all are now stuck.

“You also have to look at the situation from the owners’ perspective,” says Ozcan. “He’s saved up everything his whole life to buy the property and figure he can’t profit from it. Costs for landlords have increased by 100% while they are only allowed to increase rents by 25%. This forces them to find ways to make up the shortfall with new tenants. And that puts tenants and landlords in conflict.

Turkey, like much of the rest of the world, in the fight against rising inflation

(AFP via Getty Images)

The housing crisis has monopolized public debate in Turkey for months, potentially affecting the prospects of President Recep Tayyip Erdogan’s government ahead of elections next year. On Sunday, demonstrators in Antalya took to the streets to protest against rising rents. Residents of Trabzon, a conservative Black Sea region that is a mainstay of Erdogan’s political support, recently learned that rent prices in their region were second only to Antalya, due to soaring construction costs and strong demand for rental accommodation from local and international buyers.

This influx of international buyers in the main cities of the country has considerably increased the pressure. Ozcan says it now caters to clients from Uganda, Nigeria, Iran and elsewhere, who can afford to pay more than local residents.

“Turks can’t buy anything for their 500,000 Turkish liras (£22,000),” he said. “But a foreigner who has $500,000 (£416,000) can get a lot.”

During the interview at his office in Istanbul’s Okmaiden district, a Turk came in and asked if there were any apartments available for rent in the 4,000 lira (£176) price range. Ozcan told him apologetically that he had nothing available in that price range, or anything affordable.

“Normally I rented four units a month,” he says. “Now it’s more like one unit every two months. I am ashamed of not being able to help people find accommodation. »

Prices for utilities, building materials and property taxes have all jumped over time. Rising costs and uncertainty in recent years have slowed new housing construction, adding to pressures. The government launched a project to build 250,000 new affordable homes to ease the housing crisis, attracting 8 million applicants.

Authorities are proposing new plans to try to rein in rent increases, such as requiring landlords to post rental contracts online, preventing informal cash transactions with those who can afford it.

Turkey’s minimum increase will increase significantly in 2023, helping those in Istanbul and the country who are struggling

(AFP via Getty Images)

In addition, the government has blocked international buyers from registering or obtaining official residency documents if they rent or even buy apartments in 1,162 neighborhoods in the country’s urban areas. At a time when most European cities are trying to attract entrepreneurial teleworkers who earn their money abroad and spend it where they live, Turkey recently imposed draconian labor rules making it more difficult to work as a consultant or freelancer in the country.

On Thursday, Turkey announced it would raise the minimum wage by 55% next year, to 8,506 Turkish liras (£344), a move that could ease some economic hardship but also risks exacerbating inflation.

None of the remedies seem to have had any impact. Rent notices blatantly violate the law by requiring deposits or monthly payments in dollars or euros. Anecdotal accounts suggest that rising housing prices are beginning to cause an exodus of Turks from big cities to their hometowns, reversing a trend of urbanization in the country that began decades ago. Economists fear that this migration could lead to labor shortages that could further aggravate inflation.

“Istanbul has become great for the rich, hell for the middle and lower classes,” said one user on a popular social media chat site.

Canan, who has requested that her surname not be used, has little to rely on as the pressure to move on increases. She has lived in her apartment for more than 10 years, which gives her landlord the right to ask her to leave. She says she has hired a lawyer and joined a tenants association to argue her case, but fears all legal avenues have been exhausted. She says she feels betrayed by the government and her nation.

“We have sacrificed so much, but our country does not value our work or our lives,” she said. “The system makes you feel like nothing.”

The Independent Gt

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