What Kind of Property is Profitable to Buy in Turkey in 2023

Enough analytics is available about the rise in property prices in Turkey in recent years, taking into account inflation and without. Current question for investors today:

With high prices already at the start of construction, is it profitable to invest and will real estate prices continue to rise in Turkey?

What Stimulated the Increase in Prices for Apartments Twice?

• • Coronavirus is gone along with the old prices for apartments 1+1 at €45.000. Today, the minimum for investment is from €90.000 in simple complexes and locations in Alanya to a solid 4. In Istanbul, the minimum price tag is 30-40% higher.

• • In 2017, the market grew significantly due to the abolition of VAT on the purchase of real estate, a one-time tax of 4% was recorded upon receipt of a TAPU document for an apartment. By the way, in July 2023 this and other registration costs were increased by 50%, now the tax is 6%.

• • Since 2018, foreigners have been able to obtain Turkish citizenship by purchasing real estate with a cadastral value of $250.000. In 2022, the required minimum amount was increased to $400.000, but there are even more people who want to get Turkish passports, due to geopolitical circumstances. Rumors are actively circulating among experts and market players that the amount may soon be increased to $600.000.

• • Also in 2022, a minimum was set for an apartment price in order to obtain a residence permit, up to $50.000 and $75.000, depending on the status of the city.

• • But all these amounts are relatively low, and the programs for obtaining a residence permit and a passport for investment in Turkey are simple, understandable and profitable, there are very few analogues. Due to this, the market grew, construction gained momentum in foreign-oriented regions, such as the province of Antalya and all its districts, as well as in multinational Istanbul.

What Happens to the Turkish Real Estate market in 2023

• • The earthquake in the south-east of Turkey and the expectation of the outcome of the presidential election significantly slowed down the market. But builders and developers did not stop, and prices in the price lists continued to rise. The Turkish real estate market and experienced realtors have experienced more than one crisis. Prices in Turkey are always rising, but never falling.

• • The price of building materials continues to rise, labor costs are growing, the minimum wage has increased by another 30% in July 2023. Land plots have risen in price several times and there is a significant shortage of them in demanded locations. And the demand for resort luxury in the Mediterranean and liquid real estate in Istanbul is only growing, both in the domestic market and among foreigners.

• • Turkey ceased to be a budget option to start life from scratch by the sea about 2 years ago. But that perception, fueled by low property prices before the coronavirus, still remains. The development, the level of infrastructure and the scale of development of modern Alanya, for example, make you wonder whether it is worth taking a used “one-room apartment” in the old quarter in Spain, and not a luxury two-room apartment in the elite quarter of new buildings in Alanya, for the same money.

• • The availability and scope for processing remote transactions during the pandemic significantly accelerated the construction and development of the markets of Antalya, Alanya, Mersin and Istanbul. Stay Investment experts note that now 80% of sales for new construction projects take place remotely. Clients strive to save their money in foreign currency and increase it by 15 – 30% upon completion of construction. There is no more profitable, understandable, predictable, safe and simple alternative to real estate.

• • Many experts note that after the re-election of President Erdogan, monthly demand is growing by 20-40%. We will see the results of this in the TurkStat statistics for the third quarter of 2023.

• • The market returns its momentum. The average investor check has doubled, but the quality of projects is growing along with it. Real estate in Turkey is interesting both in terms of investment and as an absolutely unique opportunity to buy modern housing with an ideal price-quality ratio. The minimum standard of housing in Turkey is like a prestigious business and comfort class “for all the money in the world” in many European Countries.

• • It is enough to walk through the modern quarters of the resort of Alanya to understand why not Italy, Spain or Dubai “for that kind of money”. The resort province of Antalya is not inferior, develops and adheres to the line of elite construction. Istanbul projects are not inferior to Dubai, even more superior to them in terms of concepts and infrastructure of the residential complex.

• • Buyers with a high level of wealth can afford to buy property in the appropriate environment, with a certain level of surroundings and maximum comfort living conditions, almost like in five-star hotels.

How to Choose a Project for Investments

• • The investor’s checklist can include either many items for independent analysis, or just one – to choose a competent specialist with many years of experience in the primary market. If, nevertheless, you would like to go through an independent market analysis, what to look for, we will consider further.

• • Payback and profitability can be predicted in the simplest way: select several analogues of the project, go to booking services like AirBnb and see the rental prices in low and high seasons. Now, at least 8% per annum in foreign currency can be obtained by renting out the simplest apartment in Turkey for a short time.

• • The market has grown greatly, many new developers have appeared who have no previous experience. They may offer good prices, but they will be small projects of an outdated format that will also increase in value over time. But the most liquid real estate today is large complexes with luxury infrastructure on a large territory. There were significantly more such projects in 2021-2023, as the outskirts began to be actively built up, where experienced and stable developers buy out large plots.

• • The infrastructure of the complex is now more important than proximity to the sea. All remote projects already provide a shuttle to the beach, which is convenient and even more reasonable than going to the sea 500 meters in the heat. Bright projects with good prices are often far from the sea.

• • Traditionally, the best investment option is the first line and the center. But projects are in short supply, and prices for 1 + 1 start from €200.000 and more.

• • As for Istanbul, there should be no compromise when choosing a location. Metro, metrobus, buses, other public transport, key highways should be nearby or within walking distance. It should be either a developed area, or a promising one, but with a clear and visible development plan – the construction of a shopping and entertainment center, schools, colleges, the opening of large supermarket chains, and the arrangement of park areas. Not every wasteland with pits in Turkey is quickly overgrown with infrastructure, but you can focus on developers if they can clearly justify their prices with budgets and official plans of local authorities.

• • Is it worth relying on the factor of open and closed areas for residence permits? Most likely, these are time constraints, and the course of changes cannot be predicted. But many experts are inclined to believe that areas closed for residence permits will soon be opened for homeowners, leaving them closed for tourist residence permits for rent. These are crowded with foreigners, developed and interesting areas, TOP demand. Therefore, prices in them will definitely increase if the opportunity opens up to obtain a residence permit for real estate ownership.

• • Do you have any questions? Walk this path of studying the Turkish real estate market 2023 with our experienced manager. The situation in the industry, legislation and real estate development formats have changed in recent years, and we always keep our finger on the pulse of the market, offering our investors the best opportunities. Contact for a consultation!