Residents of Istanbul are leaving the city because of the rent crisis

• Mitra Nazar

  Turkish journalist

Retired Nurdan has been living in her flat in Istanbul’s Kartal district for just over a year. But her living room is already full of moving boxes. A big rent increase is coming, which she can’t afford. She is preparing for her third move in three years.

With every move she is pushed further out of her beloved Istanbul. Even the distant suburbs have become unaffordable. She has already started packing, but hasn’t been able to find a new home yet. “Everybody’s asking, where are you going now?” she says as she wraps her glassware in newspaper. “The answer is: I don’t know.”

Nurdan is not alone. There is a lot of movement in Istanbul, towards the suburbs and further out of the city. The main reason: persistent high inflation, which has been higher than fifty percent for three years. It is causing an unprecedented rental crisis, which is greatest in the capital city of Istanbul, where rents have tripled in recent years.

In Turkey, a landlord can increase the rent every year by the percentage of inflation. In September, the confirmed rent increase was no less than 65 percent. In fact, landlords have often increased rates by even higher percentages in recent years. This causes conflict between landlords and tenants. And when tenants leave, rent sometimes doubles overnight for new residents.

For Nurdan, an increase of 65 percent means that her rent will be higher than her pension. “It’s devastating, both financially and emotionally,” she says. Her pension was never a fortune, but she was able to support herself. “I even had money left over to go to the movies or the theater with friends from time to time. That is no longer possible.”

The rental crisis made the international media in January. The head of the Central Bank of Turkey at the time, Hafize Gaye Erkan, had moved in with her family because she could not find a place to live after coming from the US to take the top job. “Could it be that rents in Istanbul are higher than in Manhattan?” she was very surprised in an interview.

Figures from the Turkish Statistical Office (TUIK) show that more than 2 million people moved from Istanbul between 2018 and 2023. People mostly moved back to their hometowns or to smaller cities in the country .

According to economists, the fact that inflation in Turkey has risen so high is a direct result of the interest rate policy of the Central Bank of Turkey, which is completely under the control of President Erdogan.

For years he wanted interest rates to remain low to encourage investment. But low interest rates always lead to high inflation. Despite constant increases in salaries and pensions, the income of most Turks lags behind inflation.

According to experts, there is simply not enough money in the treasury to equalize this. The minimum wage has now fallen below the poverty line. More than half of Turks earn around the minimum wage. The opposition wants early elections due to the ongoing crisis, but Erdogan promises improvement soon.

The Turkish government says that the reason for high inflation is due to the coronavirus pandemic, geopolitical tension in the region, and says that other countries are also struggling with inflation and livelihood crisis. Erdogan asks people to be patient and promises that better times will come soon.

Since Erdogan’s re-election last year, a new economic direction has been set with the appointment of Mehmet Simsek as finance minister. He managed to convince Erdogan that interest rate policy needed to change.

Interest rates rose sharply at the start of 2024, which should eventually reduce inflation. But inflation still peaked at 75 percent in May. “We need patience and time,” Simsek said in an interview with CNN Turk. “The hardest time is behind us.” Simsek predicts that the Turkish economy will not show real development until the end of 2025.

Uncertain times are coming again for the retired Nurdan. She has considered moving to the country. But she was born and raised in Istanbul. “That’s my problem,” she says. “I don’t have a small town to come and go back to, like a lot of people do now. I’ll be a stranger everywhere.”