‘I don’t know what to do’: Skyrocketing inflation and rent prices leave many in Turkey struggling

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

The shock came in November, when her landlord demanded she vacates her 2,000-lira (£88) a month flat. She has been looking around for other housing in her Bakirkoy neighbourhood, but rents there have skyrocketed to between 5,500-lira (£242) for a tiny space to 11,500 (£506) a month for a flat comparable to hers. She dreads the prospect of moving to a cheaper flat in a different neighbourhood and spending nearly all her money on housing.

“I don’t know what to do,” the 52-year-old says. “I have started to have health problems because I am so stressed. I am going to the hospital regularly. I am seriously hopeless for my life. If I can’t go to the cinema or a movie or go on a vacation or go out for a meal on occasion…”

Turkey is in the grips of an economic crisis in which soaring prices are eating away at ordinary people’s savings and lives. While the United Kingdom and European Union inflation rates are around 10 per cent, Turkey is officially estimated at around 85 per cent in November, while independent analysts peg the rate at much higher.

Nowhere has the impact fallen harder than on 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 spike in rental prices and home values.

According to the statistics tracker Endeksa, rents are up 159 per cent during the last year, while home prices have jumped 185 per cent.

In greater Istanbul, rents have risen about 150 per cent, while those in the city of Izmir and Ankara have risen slightly higher. Rents in the resort city of Antalya, home to many who moved thanks to the war in Ukraine and the political repression in Russia, have jumped nearly 300 per cent.

By Turkish law, landlords are allowed to raise rents year-on-year by only 25 per cent. But many are finding loopholes to skirt the rules, or simply using the curtailing of maintenance and services to try and force tenants with lower rents to moving out so they can put up prices for new tenants.

But the high prices mean those with rents set at the pre-inflationary period are often refusing to budge, drastically lowering available housing stock and driving up prices even further. Despite the rental costs, vacant apartments at the lower end of the housing market often draw 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 renter in a district  on the Asian side of  Istanbul. “He said it was too inexpensive. I said we have spent money fixing this place, and you can raise the rent only 25 per cent. He kept saying it was too inexpensive.”

They later 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 needed  to give the apartment to his son and his family, one of the loopholes that allow landlords to evict tenants.

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

Landlords note that the inflation crisis has hit them, too. Their bills and debts are also increasing, forcing them to increase prices.

Cemal Ozcan, of Cihan Real Estate, a brokerage in Istanbul, said he himself was forced to pressure a tenant to leave a building he owns because he needed a place for his recently-married daughter and son-in-law, who were unable to find an affordable flat. He gave his tenant (of seven years) six months to move out. But the tenant found nothing, and all of them are now stuck.

“You have to look at it from the landlords’ point of view as well,” says Ozcan,. “He saved everything for a lifetime to buy the property and imagine he can’t make a profit of it. Costs for landlords have increased 100 per cent while they are only allowed to raise rents 25 per cent. That forces them to find ways to make up the shortfall with new tenants. And that puts tenants and landlords into conflict.”

The housing crisis has consumed public debate in Turkey for months, potentially impacting the prospects of President Recep Tayyip Erdogan’s government ahead of elections to be held next year. On Sunday, protesters in Antalya took to the streets to protest the rising rental costs. Residents of Trabzon, a conservative Black Sea region that is a pillar of Erdogan’s political support, recently learned that their region’s rent prices were second only to Antalya, driven up by soaring construction costs and high demand for rental homes from both locals and international buyers.

This influx of international buyers into the country’s main cities has added dramatically to the pressure. Ozcan says he now handles clients from Uganda, Nigeria, Iran and elsewhere, who can afford to pay more than local residents.

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

During the interview at his office in the Istanbul neighbourhood of Okmaiden, a Turkish man walked in and asked if there were any apartments available to 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.

Xural.com