Foreign Owner Wants to Terminate a Property Management Agreement in Turkey: Can the Company Withhold Rental Income? (2026 Updated Guide)

A foreign property owner wants to terminate a management agreement in Turkey. Learn whether the management company can withhold rental income, deduct fees, refuse accounting records or continue collecting rent after termination.

Foreign property owners in Turkey frequently appoint property management companies to find tenants, collect rent, pay expenses, coordinate repairs and manage the property while the owner lives abroad. Problems can arise when the owner decides to terminate the relationship and the management company refuses to transfer accumulated rental income, deducts disputed management fees or claims that it is entitled to continue collecting rent. The central legal questions are whether the management agreement has been validly terminated, what amounts the management company is contractually entitled to deduct, whether it has a legally sustainable basis for retaining the owner’s money and how control of the property and rental payments can be transferred safely. A foreign owner should therefore examine the management contract, power of attorney, tenant arrangements, rental-payment history, accounting records and termination provisions together rather than treating the dispute simply as an unpaid-rent problem.

Why Do Property Management Disputes Arise?

A management company may have authority to collect rent, arrange repairs, pay utility or maintenance expenses, communicate with tenants and deduct agreed fees before transferring the balance to the owner. Disputes commonly arise over unpaid rental proceeds, unexpected commissions, maintenance expenses, early-termination charges, security deposits, tenant placement fees or alleged debts owed by the property owner.

The first step is to determine exactly which rights were granted to the management company.

Review the Property Management Agreement First

The written agreement is usually the starting point. Important provisions may concern the duration of the relationship, automatic renewal, termination notice, management commission, tenant placement fees, repair authority, expense limits, rent collection, accounting obligations, security deposits and dispute resolution.

The owner should obtain the complete signed version together with any amendments or additional protocols.

Can a Foreign Owner Terminate the Property Management Agreement?

Potentially, yes, but the legal consequences depend on the nature of the contractual relationship and the termination provisions. Some agreements have a fixed duration, while others allow termination on notice or under specified circumstances.

A distinction should also be made between ordinary contractual termination and termination based on an alleged serious breach by the management company.

Check the Notice Period

The contract may require advance written notice. The owner should determine how notice must be delivered and when termination becomes effective.

Sending an informal message may create an unnecessary dispute about whether termination was valid.

Use a Clear Written Termination Notice

The termination notice should identify the property, contract, effective termination date and the owner’s demands concerning rental proceeds, keys, tenant records, deposits, invoices and accounting documents.

Where a significant financial dispute exists, formal service methods may be preferable for evidentiary purposes.

Can the Management Company Refuse Termination?

A company cannot necessarily prevent termination merely because it wants to continue managing the property. However, it may claim contractual rights arising from early termination, unpaid fees or another contractual provision.

Whether those claims are legally valid requires examination of the actual agreement and applicable law.

Can the Company Withhold Rental Income?

The fact that a management company collected rent does not automatically mean that the money becomes the company’s property. The company must identify the contractual or legal basis for any amount it retains.

If the company claims management fees, repair expenses, commissions or another receivable, each deduction should be examined separately.

Management Fees May Be Deductible

If the contract expressly authorizes the company to deduct a defined management commission from collected rent, that amount may be treated differently from the remaining rental proceeds.

The owner should verify the agreed percentage, calculation method and period for which the fee is claimed.

Disputed Fees Should Be Itemized

A management company should not simply state that it is withholding the entire rental balance because “fees are owed.”

The owner should request an account showing rental income received, dates, tenant payments, management commissions, repairs, taxes or charges paid, security deposits and the remaining balance.

Early-Termination Fees Require Contractual Review

Some property management agreements impose an early-termination payment. Whether the company can enforce the clause depends on the contract and circumstances.

The existence of such a clause should not automatically be treated as permission to retain every amount collected from tenants.

Repair Expenses Can Become a Major Dispute

Management companies may claim that rental income was used for repairs. The owner should request invoices, receipts, contractor information and evidence that the expenditure was authorized.

Large or unusual repairs should be compared with any contractual spending limits.

Unauthorized Expenses Can Be Challenged

If the manager incurred expenses beyond its contractual authority, the owner may dispute whether those amounts can properly be deducted.

Emergency repairs may require separate analysis because immediate action can sometimes be necessary to protect the property.

Request a Complete Accounting

A foreign owner should request a transaction-by-transaction accounting rather than merely asking, “How much money do you owe me?”

The accounting should ideally identify rent received, payment date, tenant, relevant month, commission, expenditure, security deposit and net balance.

Bank Records Are Important Evidence

Compare the management company’s accounting with the owner’s bank statements and tenant payment evidence.

If rent was paid into an account controlled by the manager, obtain whatever records are lawfully available showing the payment history.

Contact the Tenant Carefully

The tenant may be able to confirm the amount and dates of rent paid. However, communication should be handled carefully so that the tenant does not receive contradictory payment instructions while the management relationship is being terminated.

The Tenant Should Know Where Future Rent Must Be Paid

After the management company’s collection authority ends, the owner should provide clear and legally appropriate instructions concerning future rental payments.

The transition date should be unambiguous to prevent the tenant from paying the wrong person.

What If the Tenant Continues Paying the Former Manager?

This can create a separate payment dispute. The legal consequences may depend on what the tenant knew about termination and what authority the former manager appeared to retain.

The owner should therefore notify relevant parties promptly once authority has validly ended.

Review Any Power of Attorney

Foreign owners often issue powers of attorney allowing a representative to manage property, enter leases, collect rent or perform other transactions.

Termination of the management contract and revocation of a power of attorney are not necessarily the same act.

Revoke Unnecessary Authority Separately

If the management company or its representative holds a continuing power of attorney, determine whether it should be formally revoked.

Otherwise, the contractual relationship may have ended while external authority apparently remains in place.

Notify Relevant Parties of Revocation Where Necessary

Depending on the powers previously granted, appropriate parties may need to be informed that the representative is no longer authorized to act for the owner.

This can help prevent new leases, collections or transactions after termination.

Recover the Property Keys

Termination should include a formal handover of all keys, access cards, remote controls and other means of access.

The owner should record what was returned and when.

Obtain the Original Documents

Request lease agreements, tenant correspondence, inventories, inspection reports, invoices, maintenance records, insurance documents and other property-related materials held by the manager.

These records may be needed to continue management or pursue a financial claim.

Security Deposits Must Be Identified

Determine whether the tenant’s security deposit is held by the owner, manager or another institution or account.

A security deposit should not simply disappear into the management company’s general accounting when the relationship ends.

Existing Tenant Rights Continue

Ending a property management agreement does not automatically terminate the tenant’s lease.

The foreign owner becomes responsible for ensuring that management changes do not interfere unlawfully with the tenant’s existing contractual rights.

The Manager Cannot Create an Eviction Right Merely by Leaving

If the owner wants both to terminate management and remove the tenant, those are separate legal questions.

The existence of a dispute with the management company does not itself constitute a ground to evict the tenant.

What If the Management Company Refuses to Transfer Rental Income?

The owner should first establish the exact amount claimed and formally demand payment and accounting.

If payment is not made, debt recovery, enforcement proceedings or litigation may become relevant depending on the nature of the claim and evidence.

Interest May Become Relevant

Where a monetary debt is due and remains unpaid, interest consequences may arise depending on the legal basis, maturity and circumstances.

The formal demand can therefore become important in determining the chronology of the claim.

Can the Owner Start Enforcement Proceedings?

Potentially. If the owner has a sufficiently identifiable monetary claim, enforcement mechanisms may be considered.

The management company may object, in which case the dispute can develop into further proceedings concerning the existence and amount of the debt.

Interim Protection May Be Necessary

If there is evidence suggesting that collected rental income or other assets may be dissipated, the availability of precautionary legal measures can be evaluated.

Such remedies require case-specific legal conditions and should not be assumed to be automatic.

What If the Manager Refuses to Return Keys?

Refusal to surrender access after authority has ended can substantially increase the seriousness of the dispute.

The owner should document the demand for return and avoid informal confrontations that could complicate possession or evidentiary issues.

What If the Manager Continues Collecting Rent?

The owner should preserve evidence of all post-termination collections and communications.

The tenant should receive clear payment instructions, and the former manager may be required to account for amounts received after its authority ended.

What If the Company Signs a New Lease After Termination?

The legal consequences depend on whether the company still possessed actual or apparent authority and the circumstances known to the tenant.

This is one reason powers of attorney and third-party notifications should be reviewed immediately when the relationship ends.

Foreign Owners Should Check Their Tax Records

Rental income and management expenses can have tax consequences. The owner should ensure that the amounts reported by the management company correspond with actual rental collections and expenses.

A management dispute should not result in inaccurate financial records being ignored.

Property Sale Plans Require Additional Care

If the owner intends to sell the property after terminating management, all keys, lease records, deposits and management authority should be clarified before the transaction.

An unresolved management dispute can complicate due diligence for a prospective purchaser.

Can the Owner Claim Damages?

Potentially. If a management company’s contractual breach causes provable financial loss, damages may be considered in addition to recovery of withheld rental income.

The owner must distinguish the principal money owed from additional losses allegedly caused by the breach.

Lost Rental Income Must Be Proven

If poor management allegedly caused a vacancy or reduced rent, preserve listings, tenant correspondence, comparable rental information and other evidence.

Claims based on hypothetical rental income can be more difficult than claims for rent actually collected and not transferred.

Unauthorized Discounts Should Be Investigated

If the manager agreed to rent reductions or concessions without authority, review the management contract and tenant communications.

Determine whether the manager had discretion to negotiate those terms.

Short-Term Rental Activities Require Separate Review

If the company used the property for short-term accommodation rather than ordinary residential leasing, regulatory, contractual and accounting issues may differ.

The owner should establish exactly how the property was used.

Foreign Owners Should Preserve Digital Evidence

Keep emails, messages, online management dashboards, payment reports, photographs and electronic invoices.

Do not rely solely on access to an online account controlled by the management company, because access may disappear after termination.

Download Records Before Access Is Removed

Where possible and lawful, preserve existing statements and documents before the management relationship deteriorates further.

Maintain the original files rather than screenshots alone where original records are available.

Do Not Accept an Unexplained Final Balance

A statement showing only “income minus expenses” may be insufficient where substantial sums are disputed.

Request supporting documentation for material deductions.

Formal Notice Can Clarify the Dispute

A carefully prepared notice can demand termination, accounting, transfer of rental proceeds, return of deposits and documents, surrender of keys and cessation of further representation.

This can also establish a clear evidentiary timeline.

Foreign Owners Can Act Through a Lawyer

A property owner who lives outside Turkey does not necessarily need to travel for every stage of a management dispute.

Depending on the required legal actions and authority granted, a lawyer may handle formal notices, negotiations, enforcement proceedings and litigation on the owner’s behalf.

Review Jurisdiction and Dispute Resolution Clauses

Some management contracts contain jurisdiction, arbitration or other dispute-resolution provisions.

These provisions should be checked before commencing proceedings.

Mandatory Mediation May Need to Be Considered

Depending on the legal characterization of the dispute and claims pursued, mandatory pre-litigation mediation requirements may become relevant before filing a lawsuit.

The procedural route should therefore be determined from the specific contractual relationship rather than assumed in advance.

Immediate Action Plan for a Foreign Property Owner

A foreign owner seeking to terminate a Turkish property management agreement should obtain the complete contract, review termination provisions, identify all powers of attorney, calculate rent collected and expenses deducted, preserve bank and tenant records, issue an appropriate written termination and accounting demand, revoke unnecessary authority, notify relevant parties, redirect future rent payments, recover keys and documents, identify the location of security deposits and evaluate enforcement or litigation if rental proceeds remain unpaid.

Frequently Asked Questions

Can a foreign property owner terminate a management company in Turkey?

Potentially, yes. The contractual termination provisions, duration and circumstances of the relationship should be reviewed first.

Can the property management company keep collected rent?

It should have a contractual or other legally sustainable basis for amounts retained. Management fees and authorized expenses should be distinguished from rental proceeds belonging to the owner.

Can the company deduct its commission before transferring rent?

Potentially, where the management agreement authorizes the deduction. The amount should correspond with the contractual fee arrangement.

Can the company retain all rent because an early-termination fee is disputed?

The existence and enforceability of any termination fee and the company’s basis for withholding other funds should be examined separately.

What should the owner request when terminating the agreement?

A complete accounting, rental proceeds, tenant and lease records, security-deposit information, invoices, keys, access devices and other property documentation should be addressed.

Does terminating the manager terminate the tenant’s lease?

No. The management agreement and the tenancy are separate legal relationships.

What happens if the manager keeps collecting rent after termination?

The owner should document the collections, notify relevant parties appropriately and pursue accounting and repayment where the former manager no longer had authority to receive the money.

Should a power of attorney also be revoked?

Where the manager or representative holds a continuing power of attorney, it should be reviewed separately and revoked where appropriate.

Can a foreign owner recover withheld rental income without travelling to Turkey?

Potentially. Depending on the matter and authority granted, legal proceedings can generally be handled through an authorized lawyer.

What is the most important first step?

Determine exactly how much rent the management company collected, what deductions it claims and what contractual authority supports each deduction. At the same time, terminate the management relationship and any continuing representative authority through legally appropriate and provable procedures.

Client-Focused Legal Support for Foreign Property Owners

Disputes with property management companies can involve withheld rental income, disputed management commissions, unauthorized expenses, security deposits, powers of attorney, tenant payments, missing accounting records and refusal to return property documents or keys. Fırat Fesih Kaya Law Office assists foreign property owners with the termination of property management relationships and recovery of rental proceeds in Turkey. Lawyer Fırat Fesih Kaya provides legal assistance in reviewing management agreements, preparing termination and payment demands, revoking representative authority, pursuing withheld rental income, handling enforcement proceedings and representing foreign owners in property-related disputes.

Phone: +90 312 434 22 22

Mobile / WhatsApp: +90 532 769 22 22

Email: info@firatfesihkaya.av.tr

Address: Mevlana Boulevard No:221, Yıldırım Tower, Office No:148, 06520 Balgat, Çankaya, Ankara, Turkey