The Ultimate Guide to Renting Out Your Property in Turkey: Tips for Landlords

Renting out your home allows for a steady income stream, but it comes with significant responsibilities. Whether you own an apartment in Istanbul or a vacation home on the coast, knowing the legalities and best practices is essential for a smooth experience.

For landlords in Turkey, finding the right tenant, drafting a solid contract compliant with the Turkish Code of Obligations, and managing legal duties are critical steps. This guide covers everything you need to know to rent out your property safely and effectively.

1. How to Choose the Right Tenant

Selecting a tenant carefully is your first line of defense against future disputes. A reliable tenant ensures timely payments and proper upkeep of your real estate investment.

• Financial Stability: The most critical criterion is the applicant’s ability to pay. It is standard practice to request proof of income or employment history.
• References: Contacting previous landlords can provide insight into the tenant’s reliability and behavior.
• Guarantor: If the tenant’s income seems borderline or if they are a student, requesting a reliable guarantor is a safe legal measure.
• Lifestyle Compatibility: Consider factors such as family size and pet ownership to ensure they align with your property’s suitability and building rules.

2. Drafting a Solid Rental Agreement

A written lease agreement is the most vital document protecting both parties. In Turkey, if an agreement isn’t clear, disputes are often settled based on default laws, which may not favor you.

Critical Clauses to Include:

• Identity & Property Details: Clearly state the ID information of both parties and the exact address of the property.
• Financial Terms: Specify the rent amount, payment due date, and the IBAN/bank account for transfers.
• Rent Increase Rate: Define the annual increase terms. Note that in Turkey, residential rent increases are capped by legal limits (often tied to the CPI/TÜFE rates).
• Duration & Termination: Standard contracts are usually for one year. Clearly outline renewal terms and notice periods for termination.
• Usage Rules: Define who pays the dues (aidat) and utility bills, and ensure the tenant agrees to comply with the building management plan.

Pro Tip: While not mandatory, having the agreement notarized prevents the denial of signatures later.

3. Managing Deposits and Payments

Financial transparency is key to a long-lasting landlord-tenant relationship.

• Security Deposit: Under the Turkish Code of Obligations, the deposit amount cannot exceed three months’ rent. It is crucial to hold this deposit (preferably in a time-deposit bank account) to cover potential damages or unpaid debts upon evacuation.
• Bank Transfers: Always receive rent payments via bank transfer or EFT. This creates an official paper trail, which is essential for tax purposes and legal proof in case of disputes.
• Receipts: If a payment must be made in cash, always issue a signed receipt.

4. The Importance of the Handover Report (Inventory List)

Never skip the handover report when delivering the keys. This document records the current condition of the house and its fixtures to prevent “he said, she said” arguments upon departure.

• Document Everything: Note the condition of walls, floors, paint, plumbing, and built-in appliances (boilers, air conditioners).
• Meter Readings: Record the initial electricity, water, and gas meter levels.
• Photos: Take high-resolution photos of every room and existing damage before the tenant moves in. Date these photos and keep them with the contract.

5. Tax Obligations and Official Procedures for Landlords

Renting out property in Turkey involves specific bureaucratic steps. Ignoring these can lead to penalties.

Rental Income Tax

Property owners must declare their rental income to the tax office annually.

• Exemptions: There is often an annual exemption limit for residential rental income. If your income is below this threshold, you may not need to pay tax.
• Declaration: If your income exceeds the limit, you must file a return (usually in March). You can deduct expenses using either the “lump-sum” or “actual expense” method. Consult a financial advisor for current rates.

Compulsory Insurance (DASK) and Utilities

• DASK: You must have a valid Compulsory Earthquake Insurance (DASK) policy. Tenants cannot open utility subscriptions (electricity, water) in their name without a valid DASK policy number.
• Identity Notification: According to the Identity Reporting Law, building management must be informed of the new residents. Ensure your tenant registers their address with the Population Registry Office.

6. Creating an Effective Rental Listing

To attract the best tenants, your property listing must be professional and honest.

• High-Quality Photos: Use bright, wide-angle photos taken in daylight. Show the kitchen and bathroom clearly, as these are deciding factors for most tenants.
• Accurate Details: Be precise about the net square meters, floor level, heating type, and proximity to public transport (Metro, Metrobus).
• Realistic Pricing: Research the market. An overpriced home stays vacant for months, causing revenue loss.
• Transparency: Clearly state the deposit requirements and whether the house is furnished or unfurnished to filter for serious candidates.