TurkEstate went into detail about the preferences of overseas investors over the past three years, from 2021 to 2023. However, we’ll focus on other aspects such as statistics on "citizenship by investment", prospects (and figures) for investments in land plots and interest in Northern Cyprus, an up-and-coming location that currently lacks the option to obtain Turkish citizenship.
Content:
- Citizenship by investment: statistics
- Northern Cyprus: a new favourite of foreign investors
- Land investments: how they are beneficial
- Who is most interested in buying land plots?
- What about 2023?
Citizenship by investment: statistics
Almost a fifth of foreign nationals’ investments in real estate in Turkey in 2023 were aimed at obtaining citizenship through an accelerated procedure.
Therefore, 18% of the total 40,297 foreign sales transactions last year were made to obtain a Turkish passport through investments.
Moreover, 61.2% of the real estate purchased for citizenship was located in Istanbul.
Antalya and Ankara are among the three largest megacities where houses and apartments are purchased for investment transactions, together accounting for 85.6% of real estate purchases for this purpose.
In 2023, Istanbul emerged as the leader in all types of real estate, not only residential.
Following Istanbul are the provinces of Antalya, Edirne, Izmir, Mugla, Sakarya, Ankara, Kocaeli, Mersin and Yalova.
When it comes to Istanbul districts, the top three leaders in investment preferences among foreigners focused on a passport for investment are Esenyurt, Beylikdüzü and Başakşehir. They are followed by Avcilar, Kağıthane, Bağcılar, Küçükçekmece, Büyükçekmece, Şişli and Kartal, rounding out the TOP 10.
Iran ranked first among the countries where citizens showed the most interest in purchasing housing "in exchange for citizenship".
It was ahead of Russia, which ranks first in the total number of transactions (not only for the accelerated procedure to obtain passports).
However, the Russian Federation maintained second place, with Iraq coming in third. Following are China, Saudi Arabia, Afghanistan, Azerbaijan, Pakistan, Egypt and the United States.
Northern Cyprus: a new favourite of foreign investors
One major drawback of purchasing property in the Turkish Republic of Northern Cyprus is the impossibility of getting a regular Turkish passport "for investment". Nevertheless, there are significant benefits, such as the opportunity to obtain a residence permit when purchasing apartments in development projects in Turkey for any amount (at least for now), unlike Turkey, Additionally, other advantages include a favourable climate, security, high-quality medicine, education and good infrastructure. These are the advantages of living on the Mediterranean coast without facing the challenges of staying in the Schengen area and the restrictions imposed by Turkey, such as "closed" areas and the minimum amount to obtain a residence permit by right of ownership (TAPU), etc.
Cyprus is the third-largest island in the Mediterranean Sea after Italian Sicily and Sardinia, boasting 300 sunny days a year and an equally long holiday season. Dozens of verified contractors, both local and foreign, offer quite affordable housing prices to overseas buyers.
This is even though prices soared in 2023. For example, the cost of 1+1 apartments has increased from EUR 64,400 to 111,000- EUR 140,500.
It’s much more profitable to buy houses in Turkey than in the Greek part of Cyprus (south), even though the island is the same and the climate is identical, etc. For example, if the average price per square metre of a 1+1 apartment on the seashore in Limassol is EUR 14,400, the average price is EUR 3,500 in TRNC. As you can see, the difference is more than three times.
However, this is "for now": EU membership is the reason for high prices in the southern part of the island, but this gap is gradually beginning to narrow and it will shrink faster shortly.
Iskele is a new star in Northern Cyprus. Kyrenia, Famagusta, Esentepe and Gaziveren are favourites of investors from abroad as well. Prices in some places in these areas have doubled in a year, while they have increased by an average of 50% in other locations.
As for the nationality of buyers, local properties are in the greatest demand among citizens of the Russian Federation, Iran, Europe (primarily Germany, Hungary, Poland and Lithuania) and Turkey. However, the share of investors from Russia, Iran and Europe dominates, while Turks occupy only 30-40% of the total.
Moreover, another argument in favour of Northern Cyprus is that investments here also pay off easily: rents increased by more than 50% over the same period, from an average of EUR 470 to EUR 760.
Expensive apartments in Turkey, such as penthouses, are easily rented out for EUR 2,900-3,500.
TRNC is becoming a new centre of tourism and education, with 21 higher education institutions located here. The number of students exceeds 100,000 people. There are five-star hotels, but there’s a shortage of 3-4* hotels. Therefore, flats and apartments are sold out quickly, especially in summer.
Land investments: how they are beneficial
Numbers
While there was a slight decrease in residential real estate sales in late 2023 and early 2024, the number of land purchases by international buyers is increasing day by day.
For example, 28.3 million square metres of land in Turkey were sold to foreigners from January 1, 2002, to July 19, 2023. The total square footage of plots sold to foreign citizens over the past 21 years is almost equal to the area of Istanbul's Bakırköy district.
Moreover, 18.5 million square metres of land for various purposes were sold between 2015 and 2020, while the volumes rose much more in 2020-2023.
Former Minister of Environment, Urbanization and Climate Change Murat Kurum clarified in 2023 that citizens of 159 countries purchased real estate in Turkey with a total value of over TL 109 billion (EUR 3.16 billion).
Foreigners bought over 8 million square metres in 2022 alone, totalling 4,311 deals for the sale of plots, other plots of land, fields, vineyards and gardens.
Which areas have the highest demand? The value of such lots sold in Yalova reached TL 1.5 billion (EUR 43.5 million) in 2022, followed by Düzce at TL 163 million (EUR 4.7 million), Bolu at TL 62 million (EUR 1.8 million), Isparta at TL 27.5 million (EUR 800,000), Rize at TL 16.5 million (EUR 480,000), Van at TL 13.5 million (EUR 391,000) and Diyarbakır at TL 4.5 million (EUR 130,000).
Who is most interested in buying land plots?
The most interested buyers were from Saudi Arabia between 2002 and 2020, acquiring a total of 3.07 million square metres. Jordan ranked second, with 2 million square metres.
However, the situation has changed rapidly since 2020. For example, citizens of the Russian Federation were the undisputed favourites in 2022. Russians purchased 17,143 different plots of land out of 75,185 sold during the year.
They are followed by Iranians (9,023) and Iraqis (6,409).
Other top 10 countries interested in land in Turkey are:
- Germany (3,211 transactions)
- Ukraine (2,593)
- Kazakhstan (2,557)
- Afghanistan (2,271)
- Kuwait (1,889)
- USA (1,609)
- Azerbaijan (1,515)
- England (1,499)
Citizens of countries, such as Aruba, Saint Kitts and Nevis, Vanuatu, Antigua and Barbuda, Trinidad and Tobago, the Republic of Palau, Wallis and Futuna Islands, also buy land in Turkey.
What about 2023?
Mehmet Özhaseki, Minister of Environment, Urbanization and Climate Change, addressed questions about land sold to foreign citizens in January 2024, explaining that agricultural land is in the greatest demand.
As of the end of November, foreigners acquired 17,076 plots (as per the Turkish Statistical Institute (TÜIK) and the Land Cadastre).
Thus, the increase in land sales in Turkey is in great demand when concluding deals with investors from abroad.
Foreign buyers' interest in the plots is increasing. Moreover, investors are trying to have a closer look at Trakia (Thrace), as there is the least risk of strong aftershocks. The volume of land sales deals in the two provinces most in demand in this segment of real estate, Trakia and Istanbul, exceeded 122,000 in the three quarters of 2023.
Moreover, foreigners do not ignore Istanbul and its surroundings either. These include the provinces of Tekirdağ, Edirne and Çanakkale, which are popular among locals to buy land plots. Consequently, the value of land is growing quickly in these areas.
While land, gardens and fields in Turkey don't qualify for "citizenship by investment", they can still provide quick returns, potentially allowing you to almost double your initial investment or sell for a hefty profit within a few months. This can help increase your savings towards meeting the minimum USD 400,000 required for a Turkish passport through real estate investment.