Depreciation of the Turkish lira affects tenants in TRNC

The astronomical depreciation of the Turkish lira against foreign currencies is leading to tenants being forced to pay increasing rents each month despite the fact that landlords are not raising rents. 

The Real Estate Agents’ Union management has said that 65% of domestic residences in North Cyprus and 90% of commercial properties are being rented in foreign currency, Yeniduzen reports. 

Commercial tenants told Yeniduzen that due to the increasing monthly rental fees, they were forced to either lay off employees or reflect the difference on the goods and services they sell, both of which have resulted in losses.

Owner of the Address Of Fashion boutique, Eminee Hale said that she was paying rent on her shop in sterling and that she had had to sack her employees. Bakery owner in Yenikent Mehmet Mermer, said that “The increase in rent has also affected prices, and business has decreased”. Meanwhile, Feryal Çomunoğlu, owner of the Pixie Store, said, “If I paid 25,000 TL last month, I will have to pay 27,000 this month“.

Business owners who pay rent in foreign currency have called on the government to “stabilise the foreign currency rate for rentals.“.

Member of the Real Estate Agents Union Board of Directors Hüseyin Sadeghi, said that during the pandemic, efforts were made to stabilise foreign currency rates and a higher withholding tax on foreign currency rents was imposed to encourage landlords to charge rentals in Turkish Lira. None of these measures worked because landlords responded by charging higher rents.

He suggested that only social housing will help with the shortfall of building stock. Too many tenants chasing too few houses inevitably leads to rent rises, Sadeghi said.

Yeniduzen, LGC News