Dynamics of real estate prices in Turkey in 2024

The dynamics of real estate prices over the past two years shows that the cost of apartments in Turkey is growing faster than in most other countries. According to experts, next year Turkish housing will become more expensive. And there are really good reasons for this.

In our new expert article, we have prepared for you sales data, official price statistics and analysis of the Turkish real estate market, and also tell you what to expect in 2024.

Current real estate situation in Turkey

In 2023, the Republic of Turkey is faced with an increase in real estate prices, which is one of the main proofs of the prospects of this investment area. Statistics from many world ratings show that real estate in Turkey is rising in price faster than in countries popular among investors, such as the UAE and Macedonia.

Over the past one-year period, the Republic of Turkey has experienced severe inflation, which also affected other countries. However, today the state still has one of the most stable economies in the European space. Thanks to the government's efforts to implement a sound economic management plan, Turkey's interests are protected as much as possible.

Türkiye attracts not only with its wonderful climate, unique attractions and quality recreation. The Eastern state has currently become even more in demand among investors from the EU and other countries, as it has several important advantages:

• affordable price;
• high profitability and payback of housing;
• various opportunities for asset diversification;
• investment sustainability.

According to industry experts, 2023 has proven that Turkey can provide many advantages to large investors, based on its strategically advantageous geographical location, good transport links, developed tourism industry and stable position in the international political arena. Thus, Istanbul, the intersection of Europe and Asia, has become a real center of attraction for investors, where a record number of purchase and sale transactions have been concluded in recent years.

Amid currency fluctuations today, demand for real estate in Turkey continues to grow. Foreign buyers are attracted by the favorable exchange rates between the Turkish lira and the US dollar and euro. And this is a guarantee that the purchase of Turkish housing brings investors good income due to high return on investment.

Due to the decrease in the number of available land plots in the central areas of most megacities and popular tourist centers, developers have switched their attention to the construction of new large-scale residential complexes in the periphery. The construction of apartment buildings is proceeding at a rapid pace. Houses with guaranteed high-quality seismic resistance characteristics are especially in demand.

At the end of 2023, the real estate market in Turkey experienced a slight decline in sales of apartments and houses. It was assumed that the fall in demand would lead to cheaper housing. However, these predictions did not come true, and read about this further.

Statistics and analysis of the number of real estate sales in Turkey

TUIK real estate sales analytics show that 1,225,926 transactions were concluded in Turkey in 2023. That is, more than 1,200,000 residential units - apartments, houses, villas, townhouses, etc. - changed hands. Moreover, this applies to both new buildings and secondary market objects.

To date, the decline in apartment sales in Turkey has amounted to 17.5% compared to the previous year. Market players argue that the current situation is associated with inflation and a drop in purchasing power, rising costs of construction materials and wages.

In Istanbul, according to sales statistics, 198,739 properties were purchased, which shows the highest share of the total number of transactions concluded in 2023. Istanbul is followed by Ankara, with a total of 114,432 homes purchased (9.3% of total sales), and Izmir, where 65,465 properties were purchased (5.3%).

In 2023, 35,005 real estate properties were sold to investors from abroad.

The dynamics of apartment sales in Turkey in 2023 to foreigners shows a decrease of 48.1% compared to the previous year. In general, the share of sales to foreign citizens in the total volume of sales transactions concluded was 2.9%. At the same time, Antalya took first place in the ranking of the most popular cities with its 12,702 apartments sold. Antalya is followed by Istanbul, where 11,229 houses and apartments were sold to foreigners in 2023. Mersin came in third place with 3,016 transactions concluded with non-residents.

Analysis of the real estate market for 2023 also shows that people were most interested in purchasing:

• Russians - bought 10,560 objects;
• Iranians - purchased 4,272 objects;
• Iraqis - 1,917 houses and apartments.

Statistics and dynamics of real estate prices in Turkey

Let's start with the fact that expectations of a fall in property values in Turkey did not materialize.

According to statistics from the analytical platform Endeksa , the increase in real estate prices in Turkey at the end of 2023 amounted to 11.82% per year in US dollars and 102.25% over two years. The average cost of Turkish housing in 2023 is about $1,258/m2, which is more than, for example, in June, when the price per square meter was $1,142.

The average cost of housing in Turkey was about $130,000 at the end of 2023. At the same time, the average return period for financial investments in the purchase of Turkish real estate is about 16 years.

Against the backdrop of rising purchase prices, the rate of increase in rental prices for apartments in Turkey is also increasing. By the end of 2023, apartment rents were up 42% in US dollars compared to the same 2022 price tag.

Despite serious inflation, the rise in real estate prices in Turkey over 3 years has outpaced the rise in the dollar against the Turkish lira. The main reason is that prices for liquid housing in popular tourist regions are tied to the dollar and euro. It is important to take into account that in large settlements and resorts, apartments become more expensive even more rapidly, exceeding inflation and fluctuations in the exchange rate of the national currency.

Statistics by city

In a number of cities and provinces in Turkey, the largest number of real estate purchase and sale transactions are concluded. In particular, the most popular among investors are Istanbul, Antalya, Alanya, Mersin, and Ankara. Let’s look further at how things are going with the rise in real estate prices in the listed settlements.

Istanbul

Istanbul is the largest financial, business, tourist and cultural center of Turkey. Every year thousands of foreigners flock here in search of work, profitable investments, quality recreation and to move for permanent residence. And these are the main reasons why this city leads the list of popular cities in Turkey for buying real estate.

About 30% of transactions were concluded in the Asian part of Istanbul, the rest - in the European part, where foreign citizens prefer to purchase housing. Most of the sales are on the secondary market, which, of course, indicates a simple resale of real estate.

According to industry experts, there has been a reduction in the exposure time of objects. That is, the average time for posting advertisements for real estate in Istanbul on specialized websites is about one and a half months. Such a quick conclusion of transactions shows the high interest of buyers.

In 2023, the value of real estate in Istanbul increased by 11.82% in US dollars, and in two years by 102.25%.

According to statistics, in 2023, real estate prices increased the most in the areas of Istanbul: Beykoz, Sariyer, Besiktas, Kataleya, Zeytinburnu. The prices for apartments increased the least in the areas of Çatalce, Beylikdüzü, Ümraniye, Kadikoy, and Bagcilar.

Antalya

Antalya province is one of the most popular resort regions in Turkey among tourists, businessmen and investors. Buying real estate in Antalya never loses its relevance, as it guarantees investors an optimal price-quality ratio, high liquidity and return on investment.

Antalya province has been actively developing over the past few years. A large number of construction permits are issued here, and the tourism industry has fully recovered after the pandemic. All these factors strengthen Antalya's position as the most popular Turkish region for purchasing real estate and starting a business for foreigners.

The main buyers of property in Antalya are Russians, Iranians, Iraqis and Germans.

The increase in real estate prices in Antalya amounted to 7.02% in US dollars in 2023, and 108.95% in two years.

Overall, property prices in Antalya have increased by more than 140% over the past 10 years.

Alanya

Alanya is a popular Mediterranean resort in the province of Antalya. The city is one of the leaders in housing sales to foreigners. Foreign buyers are attracted by the favorable climate, gorgeous nature and wide beaches, high level of service, special Mediterranean lifestyle and guaranteed liquidity of residential real estate.

The most active buyers in 2023 were Russians, Iraqis, Ukrainians, Iranians and Germans.

Over the past year, apartment prices in Alanya have increased by 7.38% in US dollars, and in two years - by more than 130%.

The smallest increase in apartment prices in Alanya in 2023 was observed in Mahmutlar, Cikcilli, Tosmur, Demirtas.

Ankara

Official statistics from the Endeksa portal confirm an increase in real estate prices in Ankara by 30.42% in US dollars for 2023. In two years, housing costs have increased by more than 135%.

Prices rise the most in areas of Ankara such as Beypazari, Polatli, Çubuk and others. The least increase in prices affected apartments in Balata, Sinjan, Ayash, and Yenimahalla.

Mersin

Mersin is a business and industrial city on the Mediterranean coast. In recent years, Mersin has been growing in popularity as a tourist destination and a place to buy real estate at competitive prices.

Real estate in Mersin has risen in price by 11% in US dollars in 2023. Data from the Endeksa resource indicate an increase in the cost of apartments by 124% over two years.

According to official statistics, the increase in prices for apartments in Mersin most affected the districts of Gulnar, Bozyazi, Tarsus, Mut, and Yenisehir. The cost of housing increased least in Akdeniz, Anamur, Erdemli and others.

The general increase in the number of sales and the rise in price of real estate in Turkey indicate its high liquidity as an asset. At the same time, the number of foreign investors in relation to the total number of sales transactions concluded is still small. And this is another good sign for foreigners, as it guarantees protection of the market from the influence of changing geopolitical and foreign economic factors.

Turkey real estate market forecasts in 2024

According to most analysts and sales specialists, property prices in Turkey will rise in 2024. These predictions are supported by the following several factors:

• Increased cost of construction work

In 2021, the price tag for construction materials and labor costs soared by 150%, which was directly related to covid restrictions and exchange rates. In 2022, due to the military conflict between the Russian Federation and Ukraine, there was a shortage of raw materials in the Turkish construction market, which also led to an increase in construction costs by 170%. In 2023, construction materials have risen in price by 40–150%.

In addition to increasing prices for raw materials, the President of Turkey last year 2023 decided to raise the minimum wage by 34%, while in 1.5 years the minimum wage increased by 169%. This means that wages were raised for all construction workers: from general workers to engineers and designers.

• Decrease in construction rates

In 2022, approximately half as many licenses for construction work were issued as in the previous year. This means that in 2024, as in 2023, fewer new residential complexes will be built.

Some developers, due to rising prices for building materials and rising exchange rates, unable to withstand the competition in 2023, were forced to leave the market. Some developers have taken on the role of contractors on government construction sites rebuilding destroyed homes after the February earthquake. Other organizations have turned their attention to European countries in the hope of making more money.

All of these factors confirm the progression of the imbalance between supply and demand in 2024.

Increase in the cost of land plots

A distinctive feature of large cities and popular resorts in recent years is a gradual decrease in the number of vacant land plots for development. Which, in turn, leads to increased land prices by owners.

Land prices have increased the most over the past year in Ankara and Antalya, Bursa and Izmir.

• Economic crisis

The global crisis has affected the economies of all countries of the world. In the rapidly changing realities of today, real estate remains the most reliable way to invest capital. Having property is always a big plus for a person. Investments in the purchase of housing practically do not depreciate, and this asset can always be easily resold, in particular when it comes to apartments in Turkey.

Will property prices in Turkey fall?

The listed factors show that prices for apartments and houses in Turkey will rise in 2024. This means that Turkish square meters are still one of the most profitable tools for preserving and increasing financial savings.

As for the growth in sales in 2024, the situation here depends on the market, which, in turn, is influenced by a number of internal and external conditions. Despite economic difficulties and a strong earthquake, the Turkish real estate market has shown resilience. In 2024, the decisive factors in the formation and development of the market will be: government policy, inflation, goals and interest of investors from abroad.

Industry experts believe that in 2024, foreigners will still be interested in buying housing in Turkey. And, first of all, due to:

• increase in the price of objects in dollar equivalent;
• migration policy - the possibility of obtaining a residence permit and citizenship for the purchase of real estate.

Thus, according to various analysts, about 22–40% of buyers expect to obtain citizenship or a residence permit on the basis of property ownership.

All this, combined with the strategically advantageous location of Turkey, will have a positive impact on the activity of the housing market in 2024.

Investors who want to invest their money as profitably as possible are advised to monitor macroeconomic situations, infrastructure development and market trends in large Turkish cities and popular resorts - Istanbul, Mersin, Antalya, Alanya.

Is it worth buying property in Turkey in 2024?

Investments in Turkish real estate are profitable and this is an indisputable fact. The main reason is that housing prices in Turkey are predicted to continue to rise in price in the coming years. It is likely that price increases will be methodical. However, the most favorable prospects for financial investments have developed right now.

Buying an apartment in Turkey in 2024 is profitable for a number of reasons:

Favorable exchange rate

The Turkish lira has been devaluing for many years. On the one hand, this is a negative factor for the development of the country’s economy, and on the other hand, it guarantees benefits for investors from abroad who have financial assets in dollars, euros or pounds sterling. As a result, the weakening of the national currency is a plus for buyers, despite rising housing prices.

Rapid rise in housing prices in Turkey

In popular Turkish cities among buyers, the amount of available land for development is decreasing. In addition, the cost of apartments is affected by rising construction costs and labor costs.

According to forecasts from the analytical platform Endeksa, in 2024, housing prices are projected to continue to rise in big cities and popular tourist regions of the Republic of Turkey.

Projected price per square meter of real estate in 2024 in the most popular cities in Turkey, according to Endeksa:

Capital investment ratio

Experts expect that in 2024, the size of investments by foreign investors in the Turkish real estate market will reach 1 billion US dollars. In this case, resale or rental of the apartment can bring good profits in the medium and long term.

Use of modern technologies in construction

The housing market of the Republic of Turkey offers foreign buyers any property - from inexpensive apartments to premium-segment residences. Developers try to use only high-quality building materials and new construction technologies. Thanks to this, all buyers will be able to choose the right option for themselves with a decent level of construction quality.

Passive income

Rental housing in Turkey in 2023 has fallen slightly in price. However, it is still beneficial for investors to cooperate with real estate agencies and rent out their apartments for long-term and short-term rent, receiving guaranteed passive income.

The Turkish analytical portal Endeksa predicts a systematic increase in rental prices for Turkish housing in Istanbul, Alanya, Antalya, Mersin and other popular cities in the country.

Registration of residence permit and citizenship

Owning real estate is the easiest way to legalize your residence in Turkey. To obtain a residence permit, it is enough to buy housing at a price of $200,000 or more. Participation in the citizenship by investment program is possible with investments of $400,000 or more.

According to some reports, in 2024 the threshold for the cost of housing for obtaining a second passport is projected to increase. Therefore, it is important for everyone to hurry up.

Affordable prices and favorable taxation

The cost of apartments in Turkey and purchase taxes are lower than in the EU countries and the USA, which is an additional incentive for foreigners wishing to own real estate abroad.

As you can see, in 2024, the high interest of buyers in liquid properties in the Turkish housing market will continue. This will be facilitated by various factors: good conditions for investment, reasonable cost and decent quality of housing, the ability to guarantee legalization of your residence in Turkey and much more.

Buying an apartment in Turkey is a reliable investment tool, which we recommend using now! Contact our licensed real estate agency Altop Real Estate, and we will help you choose the best property in accordance with your goals and individual requests.