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The summer season of 2021, even if it turned out to be the second pandemic, can become a “high point” for investors who decide to invest in residential real estate in Turkey for the purpose of subsequent leasing. And we are talking not only about those already renting out apartments, houses and villas, but also about those who will buy them in the near future. The demand for resort housing is now colossal, and given the fact that the Turkish authorities are determined to “extend the season” this year almost until the New Year holidays - since the country's climate allows it - profits can surpass the records of previous years. Let us recall that last winter was surprisingly warm, and tourists were swimming on the Antalya coast almost until mid-December.
And this season, the owners of villas, for example, receive from tenants already up to 2000 euros per day. Thus, even a layman is quite able to imagine the potential income by comparing the purchase price and seasonal rent (even if not to mention the year-round, in lesser known, but also very popular regions).
Well, we will tell you about the most popular housing formats in 2021, as well as the regions of Turkey where it is rented out with the greatest profit.
GENERAL INFORMATION
Turkish EVA Real Estate Appraisal Consultancy presented statistics on the demand for both purchase and rental housing. Prices are going up everywhere. Thus, the provinces of Kahramanmaraş, Mersin, Diyarbakır, Şanlıurfa and Uşak rank first in terms of rent increase according to the most recent data: the growth range is from 32% to 37%. However, experts call the average prices for rent in the above-mentioned areas “quite reasonable”, in contrast to the off-scale “resort” rates.
But the provinces of Muğla and Izmir - just the same traditional summer destinations - turned out to be the undisputed leaders in terms of renting villas and other detached buildings: here an increase in price ranged from 30% to 50 %, depending on the size, location and other characteristics of houses.
Şerkan Bol, licensed EVA real estate appraiser clarified that the number of newly built houses and residential complexes is not too large, and ready-made ones are quickly snapped up. What is the result? Free housing stock is practically exhausted in some cities or districts. This provokes a rapid rise in prices for purchases, and even more for rent - among those who have not yet taken care of the location of their summer vacation.
From other provinces, the expert recommends that investors betting on rent should also pay attention to Aydin, Trabzon, Balikesir, Tekirdağ, Kocaeli and, finally, to the capital of Turkey, Ankara.
In Muğla, the average rent growth is about 13% for standard housing (units in apartment buildings) and 31% for villas and other detached buildings; in Izmir, the same figures are 14% and 35%, respectively. Although it would seem that 31% and 35% are noticeably lower than 49% and 43% of Aydin and Trabzon, we are talking about the rapid growth of rental rates in recent months: here Izmir and Muğla broke away from all other provinces. After all, only from March-April 2021 - that is, literally in a couple of months - tariffs have skyrocketed here. Only in Bodrum, for example, there is a threefold increase in a year.
Assessing the current assortment of housing supply on the market, Şerkan Bol clarified that the rise in rental prices also affects the cost of housing offered for sale; so potential investors should hurry up. “In order for the current rental and sale prices to fall to the so-called “reasonable” level, it is necessary to bring a sufficient number of new residential complexes to the market and detached houses. However, given that the cost of construction is now very high - partly due to the rise in the cost of materials - and buildings are being erected on average from 24 to 36 months, it is safe to say that even if certain measures in this direction are taken today, this is somewhat noticeable, will affect the residential real estate market - and the range of offers - only in two years”, the expert complained.
Now let us talk about different regions in more detail.
AIDYN IS “ONWARDS AND UPWARDS”
Aydin (this province, in particular, includes the large resort of Kuşadası) is a region where previously rental rates both for apartments in residential complexes and for villas or mansions were considered quite moderate. Especially in comparison with Izmir and Muğla. However, in 2021 Aydin is “gaining momentum”. Experts explain this by the convenience of transport links with the nearby resort regions (territorially, the province borders on one side with Muğla, and Izmir - on the other one), and a good location as such: here both airports are close, and transport “arteries” for travelling to other regions of Turkey by bus or car.
Thus, it is here that it is convenient to live, work, study “remotely” and go to the sea when you wish: the trip will not take much time, unlike a number of continental cities, where the sea is at least 5-6 hours of fast driving by car. As a result, Aydin demonstrates an increase in rent by 49% at once.
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MONTHLY RENTALS IN DETACHED BUILDINGS IN TRABZON HAS INCREASED
Why is Trabzon attractive? While the average rate of increase in rents for standard housing (apartments) is 6%, monthly rent in detached buildings has increased immediately by 43%. This is explained by the fact that it is in Trabzon, with its natural beauty, that it is considered especially pleasant to live in your own houses. By the way, Trabzon is the undisputed leader from the coastal provinces of the Black Sea coast. Good location is also important - I mean transport accessibility. By the way, Trabzon is also one of the closest provinces to Georgia, so the choice of “housing for rent” here is very successful in terms of offering it to tourists from Russia and the former CIS countries who do not like air travel and come by car through Georgia. And there are many of them.
ANTALYA, RUSSIAN FAVOURITE
Let us recall that every fifth housing purchased by foreigners is located in Antalya. In this province, on the territory of which most of the resorts well known to our compatriots are located - Antalya itself, and also Alanya, Kemer, Belek, Side, Manavgat - individual houses are also in greatest demand now. And it is with its own pool. Not even “one for several buildings” (a format that a few years ago was quite popular among buyers who did not have too large a budget, but still preferred a small, but detached house in a mini-sity. These are still found on the Antalya and Aegean coasts - 2-3-4 houses with a small common swimming area).
Now the landmarks have changed: the favorites are comfortable villas with terraces, spacious balconies and a private pool. The cost of renting such houses in Antalya in the summer of 2021 reached 2 000 Turkish Lira (TL) per day.
What is more attractive about buying such an object: villas on Antalya coast are not always rented “permanently”: more often it is still a seasonal rental. Thus, in the summer you can make a profit, and considerable one; in winter, you yourself can enjoy the sea, natural beauty and life in a large city with a developed infrastructure - Antalya or Alanya. Considering the fact that in both cities you can swim in the sea from March to November - and sometimes, as we mentioned above, to December - the “losses” are small: just rest in the "summer season" replaces long vacations in the "off-season", with a milder temperature regime; and, by the way, with the absence of crowds of tourists on the streets, and as a result - with lower prices (or noticeable discounts) in shops, restaurants and similar establishments. Moreover, in large cities it is very convenient to live and work / study remotely from autumn to spring.
As for the client groups (who exactly prefer to rent housing here), the analysts have presented the following figures:
- areas close to the coastline in Konyaalti and Muratpaşa districts in the center of Antalya are preferred by people with high income;
- districts stretching from the second coastline to the “hinterland”, as well as Kepez, are chosen by middle-income tenants;
- in the northern parts of the city, far from the sea, apartments are rented mainly by low-income citizens; although they live for years if they have found a suitable option for themselves.
Housing rent in the center of Antalya as well as in Konyaalti and Muratpasa amounts to now 25-30 TL / 1 sq. m. per month, and in Kepez - about 10-15 TL / 1 sq. m.
Well, those who want to run away from crowded areas, as well as live in a slightly milder climate, choose the Döşemealtı district (previously an independent territorial union, and now the official district of Antalya, located on the edge of the city). It is quite possible to get to the sea, but there are noticeably fewer people here, and besides, in summer the temperature and humidity are lower than in the center of Antalya. The rental price here is about 30-35 TL / 1 sq. m. per month.
By the way, commercial premises are well rented (accordingly, you can buy and rent them). For example, offices that are especially in demand in the very center of Antalya. In modern buildings not older than 5 years, the cost of renting one square meter has already reached 50-60 TL per month. In more “older” buildings - where there are former residential buildings turned into makeshift office centers - the cost of a square meter starts from 15-20 TL / 1 sq. m. per month.
KEMER ATTRACTS BY ITS COMPACTNESS
As for the smaller resorts, Russian tourists are very fond of Kemer which attracts attention with its compactness: it is easy to get to the center from everywhere, even on foot, besides, here you have the sea with good beaches, and natural beauty in the vicinity. Recently, more and more often housing is rented here not for short-term, but for long-term rent; now the most in demand is monthly or seasonal rent. Rental prices are determined depending on the proximity of buildings to the sea, the quality of construction and the presence or absence of furniture. Be it as it may, the cost starts from 60-70 thousand TL per season for villas with an area of 200-250 square meters, and reaches 200-250 thousand TL.
BEST SUMMER HOUSES AND VILLAS FOR RENT IN ALANYA, SERIK AND MANAVGAT
On the coastline of Serik and Manavgat, where summer cottages are more in demand than apartments, monthly rent of a small house with an area of about 200 sq.m. starts from around 2500-3000 TL, depending on the furnishing and the presence or absence of its own pool. The upper limit is 10-12 thousand TL per month and more.
In Alanya, where the slopes of the mountains are quite steep, the priority is a beautiful view of the sea. Thus, it is best to rent villas “with a view”, but on the slopes of gently sloping hills and mountains. Here the rental rate for villas with an area of 150-160 sq.m. starts from 3500-4000 TL per month and can go up to 10-12 thousand TL.
VILLAS IN KAŞ, KALKAN AND DEMRE ARE IN HIGH DEMAND
As for expensive resort towns - Kaş, Kalkan and Demre, geographically belonging to the province of Antalya and attracting attention, in particular, by nature and amazing clean beaches hidden in small bays between the rocks - real estate is always in demand here, and very expensive. However, there is very little housing for sale here, because it is almost never built. The few villas that can be purchased are in huge demand, real estate analysts confirm. Well, the rental size, considering the very limited supply, is determined in these towns primarily by the number of rooms and even sleeping places: for example, in villas with pools and sea views, which can accommodate 4-5 people, daily rent in the off-season even before the pandemic was 250-300 TL per day. When the pandemic began, it soared twice or three times, up to 600-800 TL, and now it has already reached the level of 1 500-2 000 TL per day or more.
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IZMIR- ÇEŞME - ALAÇATI HAVE BEEN ALWAYS DEMANDED
Izmir, as the most populous city on the Aegean coast, has always been in demand in terms of rent. And since it is both a business center and is located on the sea, additional streams of tenants poured here with the pandemic, including from Istanbul, who decided to live away from the crowd and work remotely; in response to this demand, the selling price of housing is rising rapidly. By the way, offices in Izmir are very popular for rent: in new buildings the average rental price is 35-40 TL / 1 sq. m. per month, in former buildings converted into offices - 25-35 TL / 1 sq. m., in office premises located in old buildings - 15-25 TL / 1 sq. m.
It is true, the devastating earthquake in the fall reduced confidence in the old buildings in the city center; so that both apartments and office premises in them are unlikely to bring a good profit if purchased with the purpose of subsequent leasing. On the other hand, offices in class A and B business centers are in great demand. Here, the rent for the year increased by 25% or more: up to 50-55 TL / 1 sq. m. per month (class A projects) and 40-45 TL / 1 sq. m. (class B projects).
As for housing in Izmir, over the year, rent here has grown to 20% (in popular resort towns, of course, even more). Reaching an average of 40-50 TL / 1 sq. m. per month.
In residential areas on the periphery of the working areas in Izmir, the average monthly rent is 35-40 TL / 1 sq. m. per month in new quality buildings, 25-35 TL / 1 1 sq. m. per month in apartment type residences. Rentals in relatively old buildings start from 25 TL / 1 sq. m per month.
Çeşme and Alaçati - the outskirts of Izmir - are expensive resort villages. Moreover, market experts consider Çeşme the “dark horse” of the past year, as real estate is growing in price too quickly. And not only ready-made housing: even land plots have risen in price by 2.5 times. And all because there you can build not one, but several houses.
Seasonal rents for mid-sized villas in Çeşme have increased by 25-30% over the previous year. Now it is kept in the range from 90 to 110 thousand TL.
Seasonal rental of villas in Alaçati increased by at least 30% compared to last year: up to 125 thousand TL. And this is not to mention elite properties - luxury villas, fashionable residences: in relation to them, rates can reach up to a quarter of a million (250 thousand TL), depending on the characteristics and location of a detached house, panoramic views, etc.
Villas in Urla can be rented at a price of 80-100 thousand TL.
LONG-TERM RENTAL APARTMENTS ARE POPULAR IN MERSIN
Although this city does not yet break price records like other coastal settlements, it is developing very quickly. With the start of the construction of the Akkuyu nuclear power plant, apartments here began to be rented well for long-term leases, primarily to local and foreign specialists who come to work on the project. The demand was so great that the local authorities had to declare war on illegal realtors from Mersin.
Rental housing in the central settlement varies depending on the age of the building and its distance from the sea. A couple of years ago, the cost of 1 square meter per month started from only 8-9 TL, but now the norm is 20-23 TL and more. Office rent throughout the city starts from 10-12 TL per square meter, but can go up to 25-27 TL.
MUĞLA - PRICE GROWTH CHAMPION
And, finally, the current champion in the growth of prices for both sale and rental of housing is Muğla.
It is curious that in Fethiye (along with Marmaris it is one of the two most famous resorts in the province), unlike other regions, daily, weekly and yearly rentals come to the fore, rather than seasonal.
But Bodrum is attracting more and more attention as a year-round destination. Investments in this region have flooded (only in the recently announced project – “Bodrum Arena” - the Russians will invest $ 83 million); as well as the guests - the population of Bodrum for the summer in 2021 has already approached a million.
It is in Bodrum that the most expensive “resort” rental in Turkey is located. Country houses for rent are rented at the price of buying a separate apartment in a less popular area. The seasonal rental price of an average villa has grown by 35-40% per year. You cannot find an option cheaper than 100-125 thousand TL, and it is already purely speculative: mansions in Bodrum for this summer have been snapped up almost all. And to rent luxury villas in preferred areas in and around the city requires a seasonal budget of 250 000 to 300 000 TL as a minimum.
To summarize, the growth in the housing cost in Turkey on average reached 34% for the year, but in resorts - 58% or more. As for the prospects for renting out residential real estate, then, considering the data presented by Turk.Estate in this article and with the advice of an experienced specialist, it will not be difficult for an investor to make their choice - so as to successfully invest funds and return them fairly quickly. And, if possible, reserve the right to enjoy your own successful purchase.