Coming soon to a state near you? Rent Increases Capped at 25% per year

Inflation Forces Head Of Turkish Central Bank To Move Back In With Her Parents - Zerohedge dot com

. . . The untenable housing market in Istanbul comes after the Turkish Central bank decided to implement a price cap limiting rent increases to a maximum of 25% until July 2024. Before initially going into effect in May 2022, rental prices in Turkey had risen 101% YoY compared to 2021. That price control does little to convey the reality of housing in Turkey. Soaring costs have driven property prices sky high for homeowners and landlords. Eviction cases have risen by 47% in the country the last two years. According to the Turkish Statistical Institute, housing sales in June 2023 dropped by 44.4% compared to 2022. That decline is due to a rising property costs that have seen housing prices rise 16.5% in Istanbul from January to May 2023 alone.

We had a state wide rent cap that went into effect several years ago. Forced me to look at where our rents were BEFORE the law went into effect. Brought them all up to market rate before, and have a yearly increase now so as not to fall behind.

No one here seems to understand anything about international finance.

The factors here are ones that do not affect the United States, at least not now. So, we Americans are, as usual, absolutely ignorant about their consequences. The stability of the US dollar, at present, prevents us from understanding whats going on in Turkey.

One US Dollar bought 19 cents of Turkish Lira in 2019. Never mind how much things costed. In 2020, 1 USD bought 17 cents, 2021 got you 13 cents, 2022 brought about 7 cents, beginning of 2023 fetched 5 cents, and now at end of 2023, USDs are selling for about 3 cents. Thats on the official market. I imagine that dollars are worth even more on the black market.

So, thats roughly about 25% reduction in the value of local money each year. Inflation must be running wild. If housing is in short supply, that would for sure justify a 25% annual restriction on rent increases.

So, be thankful that America's problems are so shallow in comparison, and it SHOULD make everyone want to be sure to want to keep America free from such problems.

Moshe

I think you have it off just a little:

2019 1 turkish LIra cost $0.17

2021 1 Lira = $0.13

today 1 Lira = $0.03

Value of the Lira is going down

You are right, Phil.

Thats what happens if I don't pay attention and copy without thinking.

Transpose Turkish lira and USD and you get the right result: a turkish lira could be bought 5 years ago for 19µ in USD, now they cost 3µ. So raising rents by 25% p.a. recovers only the costs liked to the dollar, not counting actual local inflation. I don't know what their inflation rate is, but it is probably pretty high (in addition to the currency exchange value).

To Dodge, "Does anyone here think the USA will never see prolonged inflation?"

The key work is "ever". It CAN happen. We know a lot more about economics now than we did during the 1930's, but we still don't know everything. A few serious mistakes and, YES, that could happen.

To NE, "We’ve been in inflation for 4 years."

No we haven't, not really. You have no idea what inflation is really like. a paltry 6 or 7%, thats inflation that many, many countries would die for. Most people got through this inflation cycle without really having to change their lives, or seeing their children go hungry and dying, or losing their homes or even their cars. You have no idea what inflation can be like. Back in my old country, if the lights were still on in the Ministry of Finance after 3 pm on Friday (the whole country shuts down at 3 pm on Friday for the Sabbath, until Saturday at Sundown) it meant that there was going to be a currency devaluation, so everyone would run out and buy SOMETHING (anything) to be able to get the pre-devaluation price before the actual devaluation Sunday morning [that is, anyone who had any money].

NE, you don't know how lucky you are to live in America. Don't underestimate the seriousness of the problems.

that funny-looking symbol is meant to be "cents".

I guess that Mr. Landlord hasn't caught up yet to the new character set.

Sorry, I wasn't specific. I was referring to Argentina style inflation. Some of the talking heads keep stating the dollar will collapse. (Yes, everything will eventually collapse) They're saying collapse on a time frame where we should be doing in anticipation now.

While I believe this is just a cheap call-to-action to buy their products, history tells me not to trust government and bankers.

I'm just curious of the thoughts and opinions on this group think.

Dodge, my opinion? America is finished. It is just being propped up until they pull the final plug. Now I’m just a redneck, hillbilly and not some refined sophisticated expert. But I just feel it in my bones that were done for.

Oh, and I don’t care either! Because there’s nothing that little old NE is going to do to influences these geopolitical macro trends. Turn off the news and use your energy to influence the man next to you.

I'm with NE on the real inflation percentage and not the lie the government is telling us it is. Just go buy something. I can't imagine what other countries are going through.

I know that trying to change people is like trying to change the weather. However I still want to know if I should take an umbrella or not.

"Becoming a Mennonite or Amish farmer would isolate you from our government and bankers"

I just curious how they signing the leases.

Is it one year lease or 3-6 months renewal?