Istanbul remains popular as an investment direction in Turkey. One of the world's largest megacities, this economic, financial, and tourist center attracts with the most powerful air hubs, the ability to buy residential or commercial real estate, land plots, and business opportunities for foreigners.
Antalya, the "tourist capital" of the country, has always been in favour for obvious reasons: the sea, the sun, the wonderful climate, and the tens of thousands of our fellow citizens who have already purchased housing there and are satisfied with their choice. So the interest of property buyers in the province of Antalya, with its resorts like Alanya, Side, Kemer, Belek, and several smaller ones, like Kas and Kalkan, is also not surprising.
However, right now, the Aegean region is rapidly gaining popularity. It began at the same time as the pandemic, when people made a dramatic shift from city apartments to more or less isolated houses in nature. Now, the Aegean coast is already the focus of attention of investors, including Russian ones, with its milder climate compared to Antalya and the same abundance of resort towns with the option to purchase a home.
So if someone is not familiar with the geographical names that will be mentioned below, but, at the same time, there is no will to purchase an apartment “where everyone else did” (in Antalya or Alanya), then we recommend taking a closer look at these cities and towns.
It is quite possible that buying a residential property in this place will be more profitable and life will be more interesting, or even more comfortable, than in well-known resorts.
Content:
- Izmir Province
- The dynamics of the average cost per 1 m² of residential property in Izmir (provincial average) over the past six months
- The dynamics of the value of residential real estate (on average in the province of Izmir)
- Mugla Province
- The dynamics of the average cost per 1 m² of residential property in Izmir (provincial average) over the past six months
- Dynamics of the value of residential real estate on average in the province of Mugla
Izmir Province
Gorkem Ogut, the CEO and founding partner of Endeksa, a real estate data analytics and insights platform, recalled that the Aegean region, especially the traditional “summer” areas, has always been sought after in terms of real estate. But this year, its popularity is growing so that even the “guru” of the market did not expect this: “Cesme (a town-resort near Izmir. - Ed.) entered the top ten most “valuable” areas in Turkey. Last year, housing costs grew by 133% here. The current price per 1 m² is 21,766 Turkish Liras (TL). Over the past year, Kusadasi has "gained" 138%, and Aydin has increased by 121%.
Analysts confirm that Cesme has become one of the informal "investment centers" in the whole of Turkey.
Another important aspect is earthquakes. One way or another, they are an essential part of life in Turkey. Potential buyers need to be prepared for this. Earthquakes happen often, but mostly not much. Nevertheless, it is worth remembering that Izmir, despite its high demand, is one of the most earthquake-prone regions.
In October 2020, the destructive earthquake in Izmir drew attention to the strength and quality of constructions, especially to residential buildings. This is partly why prices in Izmir and its surroundings have “flew up high in the sky”. Buyers, after all, suddenly began to ask not for a high-class location, but for “an earthquake proof house”, “a new building with the latest technology that meets all standards”. “Strong” tectonic districts have also become very prominent as well. So, people no longer look for apartments in Bayrakli and Bornova, which were hit the hardest during that period. Many buyers paid attention to Foca, where, obviously, real estate prices started to grow.
Since 2014, according to statistics, there has been a “migration” of Istanbul residents to Urla (a neighbourhood area of Izmir. – editor's note). After all, earthquakes often shake Istanbul. Local residents look for a less densely populated and, at the same time, more comfortable personal location, where they can be less focused on the rules of city life and allow themselves more pleasant selfishness, so to speak.
The early trend, the desire to move away from the hustle and bustle of the metropolis, to take care of oneself, only intensified with the pandemic and the earthquake. This started the popularity of the settlements around Izmir, not too big, but special and charming. For example, Urla has become one of the important centers of gastronomic tourism in the country. In some months of the year, Cesme and Alacati, popular resort villages, are turning into “little Istanbul” in terms of the number of tourists, restaurants, shops, etc. Even Turkish "celebrities" rushed to buy real estate in Alacati.
According to Endeksa, in 2022, prices are expected to rise by 80% in Seferihisar, by 79% in Cesme, and by 77% in Urla.
Let us illustrate this point with up-to-date figures from Endeksa analysts observed in April 2022 and for the past year.
The dynamics of the average cost per 1 m² of residential property in Izmir (provincial average) over the past six months:
October 2021 – 5,561 TL.
November 2021 – 5,985 TL (+424 TL).
December 2021 – 6,693 TL (+708 TL).
January 2022 – 7,440 TL (+747 TL).
February 2022 – 8,162 TL (+722 TL).
March 2022 – 9,248 TL (+1086 TL).
April 2022 – 10,580 TL (+1332 TL).
The 10,000 TL threshold has been overcome by the beginning of May.
The dynamics of the value of residential real estate (on average in the province of Izmir):
For 1 year – plus 141.06%.
For 2 years – plus 234.28%.
For 4 years – plus 248.14%.
Changes in value (in different currencies):
| Currency | Change over the year (%) | Change over 2 years (%) | Change over 4 years (%) | Current exchange rate to 1 standard unit (in TL, at the date of publication of the report.) |
|---|---|---|---|---|
| USD/TRY | 73.54 | 99.52 | 157.34 | 15.3418 |
| EUR/TRY | 56.47 | 77.43 | 131.68 | 16.0242 |
| GBP/TRY | 56.88 | 88.85 | 140.63 | 18.6787 |
A brief Summary
- As at the end of April 2022, in Izmir, house prices have increased by 141.06% in a year.
- The average price for a housing unit is 843,750 TL in this province.
- The average area of property on the market is 125 m².
- The average price per 1 m² is 10,580 TL.
- The average payback period is about 20 years for a standard apartment.
By the end of April 2022, Karaburun, Seferihisar, Foca, Dikili, and Menderes were the areas with the highest housing costs in Izmir. The average price of residential properties experienced the sharpest increase in 12 months.
Taking into account the same average annual indicators, Kinik, Kiraz, Odemish, Kemalpasha, and Bayrakli grew the least in prices.
In the beginning of May 2022, Dikili, Beydag, Kinik, Kiraz, and Karaburun are the areas with the fastest return on housing investments in the province of Izmirin.
In terms of return on investment, Narlidere, Menderes, Guzelbahce, Gaziemir, and Bornova are the most "long-playing" areas, because of their high cost.
Mugla Province
Since the beginning of the pandemic, all people who had an opportunity have diverted to the so-called suburban-urban life: a permanent stay away from the crowd while working and studying as usual (“remote way”). In this regard, Mugla is the first “on the list”, since there are several large seaside resorts with all the necessary social infrastructure on the territory of this province. As well as other cities are located there, including university towns, close to the sea (the Mugla city, the provincial capital of the same name, also has a few “in nature” properties in the surrounding areas).
In Mugla, the demand for rental accommodation has increased significantly. It made prices rise. As a consequence, real estate developers have begun planning additional projects in the province. These projects include elite properties, which will be new for some municipalities. A recent example is the declared unit in the small town of Gocek.
The cities of Mugla, Bodrum, Datca, Marmaris, Fethiye, started to stand out from the others, more familiar to Russians, resorts. Even in the incredibly expensive Bodrum, the increase in property prices was 134% (the price per 1 m² was 19,500 TL by the end of 2021); it was 143% (14,500 TL) in the small and pleasant Datca.
According to recent information, Mugla, well known for its coastal resorts of Bodrum, Fethiye, Koycegiz, and Marmaris, has recently entered the top three provinces with the largest number of immigrants. They are foreigners and local residents who have moved here since the beginning of the pandemic from other regions of the country.
Experts of consulting companies in the province told Endeksa that “…the immigration wave in Mugla caused a lot of activity in the real estate market. Particularly, in regions with urban structures, such as Bodrum, Marmaris, and Fethiye, sales have grown by almost 4 times. The demand for rent has also increased significantly. It is no wonder that the pandemic, which has provided the possibility to move from offline to remote work, has created a truly amazing opportunity for those willing to escape from the hustle and bustle of megacities and live in a seaside town, while not giving up their full-time job.
The activity of property developers, as already mentioned, has changed. They had to adjust their “focus” quickly. The type of “a house interwoven into nature” became the most popular. The number of eco-friendly projects that ensure life among forests with fresh air, has increased. After all, health and the ability to maintain it or to improve it after illness have come to the fore among buyers’ requests. Even housing prices have become less important (while before the pandemic, many focused primarily on the purchase budget).
Undoubtedly, Bodrum and its surroundings came to the fore. Previously, an elite resort, where people generally spent their holidays, has turned into an all-the-year-round resort in a few months. The authorities rushed to organize additional infrastructure. As a result, the resort has improved markedly during the two years of the pandemic. But real estate has noticeably risen in price here.
The fact, that several developer companies opened their new representative offices in Bodrum in 2021-2022, indicates demand for residential units.
Fethiye has received considerable attention for “forbidden activities” in the city itself and its neighbouring areas. During peak demand, some private individuals and firms launched the massive construction of villas and other types of detached houses with the hope of earning extra money. However, the authorities monitor and actively suppress illegal activities.
Below are the statistics for the Mugla province based on the data observed in April 2022.
The dynamics of the average cost per 1 m² of residential property in Izmir (provincial average) over the past six months:
October 2021 – 11,483 TL.
November 2021 – 12,161 TL (+678 TL).
December 2021 – 13 584 TL (+1423 TL).
January 2022 – 14 533 TL (+949 TL).
February 2022 – 15 280 TL (+747 TL).
March 2022 - 17,483 TL (+2203 TL).
April 2022 - 20,249 TL (+2766 TL).
The 20,000 TL threshold has been overcome by the beginning of May.
Pay attention to the price growth in the last two months (March and April): plus 2200 TL and almost 2800 TL per 1 m², respectively.
Dynamics of the value of residential real estate on average in the province of Mugla:
For 1 year – plus 143.52%.
For 2 years – plus 296.50%.
For 4 years – plus 328.55%.
Change in value (in different currencies):
| Currency | Change over the year (%) | Change over 2 years (%) | Change over 4 years (%) | Current exchange rate to 1 standard unit (in TL, at the date of publication of the report.) |
|---|---|---|---|---|
| USD | 73.54 | 99.52 | 157.34 | 15.3418 |
| EUR | 56.47 | 77.43 | 131.68 | 16.0242 |
| GBP | 56.88 | 88.85 | 140.63 | 18.6787 |
A brief summary:
- As at the end of April 2022, in Mugla, residential property prices have increased by 143.52% for the previous 12 months.
- The average price for a typical housing unit is almost 1,800,000 TL (1,799,952 TL).
- The average area of property is 132 m².
- The average return on investment period is 17 years.
- The average price per 1 m² is 20 249 TL.
The areas of Mugla: Marmaris, Datca, Ortaca, Bodrum, and Dalaman are the most valuable now.
Ula, Yatagan, Menteshe, Fethiye, and Milas grew the least in prices.
Bodrum, Milas, Yatagan, Marmaris, and Datca are the areas where residential real estate is currently paying off the fastest.
Currently, the longest return on investment should be expected in Koycegiz, Ortaca, Seydikemer, Fethiye, and Ula.
According to local realtors, Mugla is experiencing an unprecedented surge in demand from buyers from all over the world, from Brazil to Hong Kong and Nigeria. Investors from the Persian Gulf countries, such as Kuwait and Qatar, show very high interest. Recent events have attracted many wealthy buyers from Russia and Ukraine. In 2022, Turkey plans to sell properties to foreigners for at least $10,000,000,000.
Moreover, those who expect to live and earn money in Mugla are also considering the purchase of rooms in apart-hotels and residences in hotel complexes by international brands. Right now, in Mugla, with proper real estate management and “putting a property to work”, investments can be returned not in the officially announced 17 years, but in a few years, maybe even in a few seasons.
