2023 brought a storm of changes to the Turkish market, which affected potential foreign buyers who desire to purchase a good property for sale in Turkey:
● Districts of Istanbul, Alanya, and other cities were closed to foreigners receiving residence permits
● The estimated value of the property for a residence permit of $75,000 was increased to the cadastral value of $200,000
● The country does not issue a residence permit to tourists
● The threshold for citizenship is expected to rise from $400.00 to at least $600,000
● Buying land without buildings is not suitable to obtain citizenship
All these points have reduced sales statistics for foreigners by half.
High deposit rates and unavailability of mortgages force the population to put money at interest and rent real estate at prices many times higher than 1-2 years ago.
What will happen next? Are prices expected to fall due to weakened demand for real estate?
The numbers suggest otherwise
In 2023, rebar prices rose by 41%, for concrete – 134%, and for cement – 147%.
The minimum wage has risen by 169% over the past year and a half, and it will be increased by 49% on January 1, 2024, to 17,002 TL ($578.25).
The minimum wage has grown by 34% in the summer of 2023, from 8,500 TL to 11,400 TL, which significantly affects the cost of construction.
The Turkish Institute of Statistics (TÜIK) provided information on the number of construction permits issued and the area of buildings commissioned in the country:
● In the first quarter of 2022, 21.8% fewer permits were issued, and 7.9% fewer properties were delivered
● In the second quarter of 2022, permits were issued by 7.8% less, and 20.1% more housing was put into operation
● In the third quarter of 2022, permits were issued by 4.7% less, and 2.8% fewer properties were commissioned
● In the fourth quarter of 2022, 7.1% fewer permits were issued, and 6.6% less real estate was delivered
● In the first quarter of 2023, 2.1% fewer permits were issued, and 17.2% fewer housing was commissioned
● In the second quarter of 2023, 25.6% more permits were issued, and 28.6% less housing was put into operation
● In the third quarter of 2023, 21.7% more permits were issued, and 14.0% less housing was delivered
What will happen to the prices of new modern real estate in Istanbul?
There is an increased demand for new earthquake-resistant houses in Istanbul.
According to the government’s program, Istanbul is planning to demolish and rebuild all dilapidated housing in 5 years.
Recep Tayyip Erdoğan said that the country planned to build 350,000 houses in Istanbul per year in the next five years.
The government is going to allocate 1 trillion TL in 2024 to restore residential buildings. 1.5 million homes damaged in the earthquake are expected to be restored.
The renovation of dilapidated houses in Istanbul is an interesting investment potential, as developers will implement housing in these earthquake-resistant projects.
There will be a new high-quality housing stock built under strict control.
What will happen to the real estate market of the resort of Alanya?
The issue of obtaining the status of an independent provincial centre for Alanya is expected to be considered in early 2024.
This will make the city’s budget autonomous. Alanya is implementing huge infrastructure projects, such as promenades, hospitals, sports complexes, markets, schools, kindergartens, dormitories, playgrounds, parks, and much more.
The number of green spaces per person in Alanya has exceeded 10 sq. m. It was 2 and a half sq. m in 2014.
One of the most anticipated projects for 2024 is the 122 km highway between Antalya and Alanya.
Construction will begin in the spring, from the interchange in Serik and along the Taurus Mountains, north of the Konakli district.
The project can lower financial losses in tourism, agriculture, and industry, and reduce fuel consumption.
The city is developing!
Against the background of the slowdown in building properties for foreigners, no one cancelled:
● Growing domestic demand among Turkish citizens seeking one of the country’s most earthquake-proof areas
● Possible changes in migration policy in obtaining a residence permit and citizenship positively
● There is always a high demand for a clean sea, a warm climate, healthy food, beautiful nature, and other factors that attract property buyers with financial capabilities.
Alanya can lose its reputation as an inexpensive haven for moving with apartments for 40,000-50,000 euros – the city is developing and growing, it is becoming much more comfortable.
Municipal elections will be held in March 2024 with the official proclamation of Alanya as a separate province.
The demand for real estate is expected to recover by April-May. Many developers have started to offer 1-year instalments for their ready-made apartments, and there will be many more such offers.
Summing up
Turkey does not ask for the source of the money to implement development projects, unlike the EU countries.
Real estate prices are more affordable than in investment-attractive countries when comparing the price-quality ratio of offers.
Investors are very interested in investing in Alanya’s off-plan projects fearing that they will not be completed on time.
The market is changing rapidly but remains one of the most accessible in many aspects: prices, laws, resort houses with infrastructure, etc.
Istanbul is going through an era of urban transformation and remains one of the world’s most populated cities.
The annual population growth of 3.45% is the highest among the 78 largest megacities of the OECD member countries. How can real estate prices fall as demand grows?
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(pic by pixabay licence free https___pixabay.com_photos_antalya-turkey-konyaalti-sea-734)
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