Turkey – one of the most popular countries in the world in terms of buying real estate. Foreign investors are attracted by its stable geopolitical position, high standard of living, natural beauty and mild climate. The active development and growth of the Turkish economy over the past 10 years has made it possible to achieve great progress in the construction industry and real estate sales. ;
How has the Turkish real estate market changedin 2022 – We talk about the reasons for the popularity of investments, innovations in legislation and forecasts for the coming year in our article.
Real estate market in Turkey
Purchase of property abroad – one of the most important financial decisions in life, which should be made carefully and wisely. As a rule, the buyer is looking not only for apartments for living or recreation, but also for a reliable asset and source of income.
Given the geopolitical unrest on the world stage, Turkey's real estate sector has become even more popular among foreignerswho want to make profitable investments. As evidenced by data from analytical agencies.
Continuous growth, comparison with previous years
According to Turkish analysts, the annual increase in housing costs as of August 2022 amounted to more than 180% in Turkish lira. The average price per square meter of real estate in the country – 9800 TL (approx. €540). Average price tag for apartments – about 1.3 million TL (€72–75 thousand). At the same time, the value of Turkish real estate has grown more than the euro and dollar against the national currency.
If we recalculate the rise in prices in dollars and euros, on average in Turkey the cost of housing has risen 1.5 times:
- by 43% in US dollars per year;
- by 58% in euros for the same period.
In cities such as Istanbul, Antalya, Alanya, the increase in prices for apartments and houses in dollars and euros exceeded 55%, which, of course, is directly related to the increase in the number of buyers .
In total, the number of real estate transactions concluded with foreign investors over the past 9 years, according to the Turkish Statistics Institute (TUIK), amounted to 293,271.< /p>
It is worth noting that in 2013 the percentage of buyers from abroad was only 1.1% of total real estate sales in Turkey. At the end of the first quarter of 2022, the share of foreign depositors increased to 4.5%. Of course, we are talking about average statistics for the country. In popular regions, this figure increased even more. Thus, in the most popular province among foreigners, Antalya, literally in three months of this year (from January to March) more than 15,000 residential properties were sold, of which 22.4% (3,447 units) – fell on foreigners.
According to statistics from the same 2013, the amount of real estate sold to foreign citizens was:
- in Istanbul – 116,258 objects;
- in Antalya – 67,766;
- in Ankara – 14,577.
The demand for real estate in Turkey continues to grow steadily. According to TUIK data, the volume of real estate sold to foreigners from January to May 2022 alone increased by 70%, when compared with the same period in 2021. Such record data were recorded for the first time in the entire history of observations.
The list of nationalities leading in the acquisition of square meters since 2015 looks like this:
- constant leaders – Iraqis and Iranians purchased 44,092 and 30,776 objects, respectively;
- Russians – 19,773 completed purchase and sale transactions;
- Ukrainians – 5,338 issued TAPUs.
It is worth noting that due to the huge flow of buyers pouring in from Russia and Ukraine at the beginning of 2022, the statistics at the end of the year may undergo significant changes. Since the citizens of these two states greatly influenced the situation in the housing market.
Popular real estate for investment: from VIP real estate to economy class resale
Investing in real estate in Turkey implies the acquisition of objects of different characteristics and costs.
The following categories of liquid Turkish property are popular among investors:
- VIP-class real estate. These are luxury villas, elite mansions, penthouses, large duplexes – from 300–400 sq. m. Such objects are characterized by spacious rooms, thoughtful layout, expensive renovations and exclusive design of the premises, a large terrace, jacuzzi, swimming pool and garden on the site, panoramic views.
- Apartments in new buildings. Popular real estate in Turkeyamong many buyers, due to the optimal price-quality ratio, – apartments in houses under construction. A competent approach to strategy and selection of an object guarantees excellent prospects for investors and relatively low prices. Many developers offer interest-free installment payments and a convenient individual payment schedule.
- Real estate with discounts. Purchasing Turkish economy class apartments at discounts has long been justified. There are decent options in both the primary and secondary markets. Developers offer interesting sales conditions, the lowest possible prices at an early stage of construction, and interest-free installments. Resales can be purchased at a good price for cash or in lira or in case of urgent sale.
- Real estate with guaranteed income. Construction companies and real estate agencies offer investors the purchase of apartments in new residential complexes with hotel infrastructure, specifically designed for rental. The developer or agency, for a percentage received from the profit, takes on all management concerns. The owners have the opportunity to relax in their own apartment several times a year.
Increase in demand and number of sales transactions concluded
The start of the 2022 season in Turkey will be remembered by local developers, realtors and landlords forever. As we have already clarified, for several months in a row Russians have been purchasing the most housing in the resort republic, leaving behind the unchanged leaders – Iranians and Iraqis.
Increased demand from foreign citizens and the number of sales transactions concluded have led to overpopulation in some areas of Turkey. The government was forced to respond to the current situation. In connection with this, some changes have been introduced to the laws regarding obtaining a residence permit and citizenship for investing in real estate. Namely:
- From April 26, 2022 for foreigners wishing to buy apartments and obtain a short-termresidence permit for real estate in Turkey, the minimum housing price is: 75 thousand US dollars in popular provinces (Adana, Ankara, Antalya, Bursa, Istanbul, Izmir, Konya, etc. - 30 in total provinces) and $50 thousand in other regions. Let us remind you that previously any real estate, regardless of cost, was eligible for obtaining a residence permit under TAPU.
Apartments with a price tag below the threshold amount provide grounds for obtaining only a tourist residence permit, the period of which will not be taken into account during the period of residence required to obtain citizenship.
In addition to fixing the minimum amount for residence permit in Turkey for real estate , The Migration Department has introduced restrictions on the issuance of tourist residence permits in a number of areas since July 1, 2022. The list includes popular areas of Alanya, Antalya, Istanbul, Mersin. In these regions, it is not possible to obtain a residence permit when purchasing an apartment or on the basis of a rental agreement.
- Turkey still provides the opportunity for buyers from abroad to obtain citizenship for investment in real estate. Effective April 12, 2022, the minimum investment threshold has been raised from $250,000 to $400,000. The citizenship by investment program started in 2017 in the Republic of Turkey. The initial cost threshold for completing a transaction was $1 million, but due to low investor interest, a year later it was reduced to $250 thousand.
The investment qualification forTurkish citizenship for real estate is associated with an increased demand for apartments and the interest of citizens from abroad in obtaining a second passport under a simplified and accelerated scheme. An investment residence permit gives the right to apply for citizenship immediately after the transaction and within 3–10 months to receive a Turkish citizen’s passport.
Legislative updates in the real estate sector! Innovations regarding residence permits after October 16, 2023
Since the beginning of October 16, 2023, important changes have occurred in the legislation regarding the minimum value of real estate for obtaining a primary residence permit. If you became the owner of a certificate of title (TAPU) after the specified date, make sure that the cadastral value of the property exceeds $200,000 in lire equivalent at the time of registration. As before, the property you choose must be located in an area open to obtaining a residence permit.
From now on, the basis for determining the value is the cadastral value, and not the estimated value. This means that expert appraisal reports are no longer relevant for properties acquired after October 16, 2023. But if your TAPU was issued between April 26, 2022 and October 16, 2023, the previous requirements apply and the estimated value of $75,000 is taken into account.
These updates affect not only the initial receipt of a residence permit, but also its extension or transition from another type of residence permit to ikamet under TAPU.
In addition, new adjustments are expected in the Turkish Citizenship by Investment program. According to rumors, the minimum investment threshold could increase to $750,000 or even $1 million. Therefore, people who are planning to purchase real estate in Turkey in order to obtain citizenship should hurry up.
As for a tourist residence permit based on real estate, there is no exact information yet. However, the situation may change in the near future.
Follow the updates and stay up to date with the latest news in the real estate industry!
Prospects for real estate in Turkey in 2023
Based on statistical data, you can now estimate possible prospects for the Turkish housing market for 2023. Let us note several real trends:
- The Republic of Turkey remains the focus of increased attention from investors from abroad. Foreigners have access to a simple, fast and safe procedure for completing a purchase and sale transaction; a number of difficulties associated with payment for the purchase are eliminated. Which, of course, will have a positive impact on sales growth in the future 2023.
- Purchase of real estate for obtaining citizenship under an accelerated scheme will continue to attract foreign investors. After all, buyers have the opportunity to choose housing for a comfortable stay with a high return on investment. In addition, the cost of a second passport, compared to other European countries, is more than acceptable.
- According to expert forecasts, in 2023 Antalya and Alanya will remain among the favorites among foreign real estate investors. At the same time, the price tag for primary and secondary housing will continue to grow.
- The high interest of foreigners in purchasing apartments in Turkey will soon be reflected in the figures in the annual reports of realtors and developers. Buyers' interest is influenced not only by geopolitical events, but also by rising exchange rates. Against this background, Turkish apartments and houses become even more profitable in terms of purchase.
Conclusion and offer of assistance from Point Property Real Estate Agency
Given the increased demand and good investment prospects of the Turkish real estate market, you should not expect a decrease in the cost of a square meter of housing in the near future. If you've been planning to invest your savings in the resort country's housing market, now may be the right time to do so.
These materials have been prepared for informational purposes; they are not of a commercial nature.
Certified Point Property Real Estate Agency specializes in providing a full range of real estate services for residential and commercial real estate transactions in Turkey. Our company takes care of all the organizational aspects of a real estate transaction: searching for an object, organizing a sightseeing tour, assistance in collecting documents and checking the legal purity of documentation, support in re-registration of ownership. In addition, we provide our customers with a wide range of after-sales services. Contact us, we are in touch 24/7!
