Turkey Real Estate: Chronicle of Recent Years
Turkey today is in the top 3 countries where Russian buyers are acquiring residential real estate on a massive scale – after a short lull, the local housing market is again actively in demand among foreigners.
It’s no secret that the heyday of home sales in Turkey fell on a fairly long period of 2005-2013. This was a time when not only in Turkey and in Russia (Russian buyers, both then and today, more often than others invest their funds in local square meters), but throughout the world there was a stable economic situation. It was during these years that Russians began to show great interest in Turkish real estate by the sea. A considerable number of buyers could afford a small high-quality 2-bedroom apartment.
However, in 2014, an economic crisis began in Russia and a number of CIS countries, where the ruble depreciated, which undoubtedly affected our real estate buyers, the budget of potential buyers of a “summer residence in Turkey” almost doubled, resulting in a 2-bedroom apartment in ruble equivalent began to cost more impressive funds.
In November 2015, after the destruction of the Russian Turkish Air Force aircraft, a period of crisis in relations between the two countries began. During this period, demand did not just fall, but practically stopped, and the echoes of the conflict between the two countries also affected buyers from other CIS countries. After the armistice in June 2016, demand began to recover slowly, but not for long – on July 15 of the same year, an attempted coup d’etat took place in Turkey.
As a result, the deepest crisis between Turkey and Russia came, not only in the political field, but also in matters of leisure, purchase and rental of real estate in Turkey by Russian citizens. In addition, there have been recorded cases where Russian owners of Turkish housing sold their property because of a vague future. During this period, both demand and prices fell by 15-25% depending on the type of real estate and its characteristics.
The first signs of a gradual recovery of the local tourism and real estate market showed themselves in 2017. At that time, normal relations between Turkey and Russia were again established, as a result of which tourists who were then active again opened up, not as powerful as before, but talking about the imminent onset of a positive situation in general.
Then, most Russians did not think about buying Turkish real estate, however, transactions have always been through, but not massive. In the first half of 2017, about 1.7 million Russian citizens visited Turkey, and the number of real estate purchased by the Russians during this period exceeded 3800. This is the maximum figure among foreign investors: the same parameter among the British was 2204 objects, and for the Germans – 1884 .
In total, 654,363 real estate properties were sold in Turkey in 2017. In Antalya and its region, popular with foreign buyers, according to the Turkish Statistical Institute, 54,755 properties belonged to foreigners, of which 8,852 belonged to Russians, 8,412 to Germans, and 5,779 to Kazakhs.
A sharp decrease in the number of potential buyers forced property owners to move in price. Resale property fell sharply in the period 2015-2017, and those who managed to seize the opportunity, bought apartments at very low prices. Developers also lowered the bar slightly, while increasing the term of interest-free installments by at least a year.
The real estate market in Turkey in 2018 showed a transition from a zone of weak recovery to the active phase. And if the first half of the year could still be called a rehabilitation period in the resumption of market growth, when people finally realized that relations between the two countries had become stronger and more friendly, that the Russians were in Turkey safely, the situation inside the country was stable, and real estate was still under construction and there are more and more attractive residential complexes.
August 2018 was marked by the fall of the Turkish lira, which in some periods lost 30% of its value, as a result of announced US economic sanctions against Turkey. At this moment, the real estate market among local buyers has practically subsided, while among foreigners the most active period of purchases has begun.
Currency holders, who previously could afford the most modest options for Turkish real estate, were now able to become owners of higher-class housing, and those who could not afford anything at all, got the opportunity to budget objects thanks to a cheap lira. Of course, not all real estate was nominated in Turkish currency: in such regions of foreign “consumption” as Antalya, Alanya and Istanbul, many objects were built and continue to be built, where the initial cost is indicated in dollars or euros.