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The past year was not easy, but it is for the Turkish real estate sector that it has become in some sense even profitable and advantageous. This brought Turkey almost to the level of European countries in terms of housing prices. As we know, the quality of the work of Turkish developers is known all over the world, where many famous projects were built and continue to be built by them.
But let’s talk about everything in order.
Taking into account the demand adjustments and buyers’ choice a more spacious and comfortable real estate, more preferable are houses with their own territory or, in extreme cases, multi-room apartments with large balconies and residences, in particular, with hotel services. There was an update and, in a sense, a "recovery" of the real estate market. Cheap housing is sold less, and high-quality housing is becoming more expensive, especially in popular provinces and districts.
We present expanded sales statistics for the results of May, as well as some conclusions for the year of the pandemic: from May 2020 to May 2021.
RESULTS OF MAY
In May 2021, 59,166 real estate units were sold throughout Turkey, which is 16.2% more than in May 2020. Istanbul has become a record holder in terms of volumes with 11,356 sales, which was 19.2%.
By sales, Istanbul is followed by Ankara (5,653 transactions in May, and 9.6 % of the total volume) and Izmir (3,298 transactions; 5.6 %).
According to the official portal of real estate valuation Endeksa.com, the annual increase in housing prices across the country at the end of May was 30.4 %.
The average sale price for 1 sq. m of residential real estate reached 3168 TL, the average cost per housing unit was 411 840 TL. However, we recall that this indicator takes into account even small apartments in dilapidated houses in the most remote provinces. So, prices are much higher in key cities.
In Istanbul, where the most purchase and sale transactions were made in May, the annual increase in value was 23.7%; the average selling price per square meter of housing reached 4665 TL, and the average cost of a unit of residential real estate was 489,552 TL. However, in the most popular areas of the metropolis, prices for one square meter range from 25 to 28 thousand TL. For example, in Rumelihisarı, it is 28,378 TL per 1 sq. m, with an average housing cost of 4,737,957 TL; in Pınara, it is 28,188 TL per 1 square meter, and 5,271,106 TL per housing unit; in Istinye – 27,130 TL\ 6,456,940 TL, and in Harbiye, Şişli – 25,948 \ 4,748,484 TL, respectively.
In Ankara, the annual cost increase is 25.6 %, the average selling price per square meter is 2428 TL, the average housing price is 297,570 TL.
In Izmir, housing has risen in price by 33.7% over the year, the average price per square meter has reached 3298 TL, with 485 375 TL per housing unit.
THE MOST EXPENSIVE PROVINCES
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According to the results of the year – from May 2020 to May 2021 – among the provinces with the maximum number of sales transactions, the provinces of Muğla (the resorts of Fethiye, Marmaris, Bodrum, Göcek, Datça and others are located here), Aydın (the resort of Kusadasi), Antalya (the resorts of Antalya, Alanya, Kemer, Belek, Side) have the largest cost growth. By the way, it is in the province of Antalya that every fifth housing bought by foreigners is located.
Prices in Muğla have increased by more than half over the past year: by 59.2% at once. The average sale price per square meter of residential real estate here is 7,945 TL, with 916,500 TL, almost a million liras, per housing unit.
Aydın falls behind Muğla: it is +56.2 %, the average price for 1 square meter is 4,335 TL, with 529,200 TL per housing unit.
The annual cost increase in Antalya is 45.7 %, from 3,894 TL per 1 sq. m and 440,625 TL per housing unit, respectively. Although, we recall, these are official indicators that specify prices for the province as a whole. Decent housing in Antalya and the surrounding area starts from 60,000 euros (it is from about 600,000 TL at the exchange rate on the day of publication of the article).
RESORT REAL ESTATE RECORDS
Here is some information about the resort "price records" for certain areas.
Muğla has +68 % to the price of real estate in Datça, +60 % in Bodrum and Kaş. In particular, in Marmaris and the surrounding area, where, however, there is very little housing for sale, and realtors strongly recommend checking the property before buying, so as not to run into scammers – a villa that is successful in terms of area, layout and location can still be found for 37 million (prices for apartments here start from 1 million liras), and for 22 million liras in Fethiye.
In the villages of Gümüşlük and Gündoğan (geographically belong to Bodrum), prices for luxury villas reached 150-165 million TL. Country houses in Bodrum are sold even at the price of buying a separate apartment in the property.
By the way, the same price for villas is in Belek (Antalya). Antalya can boast its own records: for the already mentioned 165 TL in Belek, you can buy a 5+1 villa (with 5 bedrooms) and a private pool, with a total area of 450 sq. m.
In Konyaalti (Antalya) and Manavgat (near the resort of Side), prices for luxury villas reached an average of 50 million TL.
In Lara (Antalya) and Alanya, prices for villas with an area of 350-400 sq. m start from 9 million TL.
So, investments in housing in the provinces of Muğla and Antalya have been considered the most promising for many months.
Investors still prefer primary housing – apartments in new buildings. In May 2021, the volume of sales of primary housing amounted to 18,204 transactions.
Moreover, people increasingly use their own financial funds, rather than bank lending, since the economic situation on the market is still not quite stable, and mortgage interest rates have slightly increased compared to last year. So, developers also benefit from frequent payment of purchases in cash or bills this year.
In May 2021, the demand for residential real estate in Turkey and from foreigners increased sharply: transactions were made by 106.5 % more than in May last year, that is, more than twice. The total number of transactions with buyers from abroad in January-May of this year amounted to 15,740, which is +24.9 % compared to the first five months of 2020.
Market experts are confident that another record for housing sales to foreign investors will be broken in 2021.
Prices are growing not just fast, but rapidly.
We present a table of price and cost changes in 30 provinces with the largest number of homes sold in May.
| Province | Number of home sales | Share of total sales (rounded to whole %) | Average price per 1 sq. m (TL) | Average price per housing unit (TL) | Annual change (%) |
|---|---|---|---|---|---|
| Istanbul | 11 356 | 19% | 4665 | 489552 | 23,7% |
| Ankara | 5653 | 10% | 2428 | 297570 | 25,6% |
| Izmir | 3298 | 6% | 4212 | 485375 | 33,7% |
| Antalya | 2264 | 4% | 3894 | 440625 | 45,7% |
| Bursa | 2190 | 4% | 2833 | 346970 | 25,1% |
| Mersin | 1881 | 3% | 2448 | 350880 | 33,9% |
| Konya | 1565 | 3% | 2174 | 320800 | 30,3% |
| Balıkesir | 1494 | 3% | 3440 | 384000 | 35,3% |
| Tekirdağ | 1487 | 3% | 2226 | 273260 | 25,3% |
| Kocaeli | 1447 | 2% | 2628 | 310500 | 23,9% |
| Aydın | 1372 | 2% | 4335 | 529200 | 56,2% |
| Gaziantep | 1354 | 2% | 2898 | 425280 | 38,9% |
| Kayseri | 1147 | 2% | 2072 | 321585 | 27,4% |
| Adana | 1077 | 2% | 2549 | 380480 | 31,3% |
| Hatay | 1049 | 2% | 2034 | 282450 | 32,0% |
| Muğla | 1034 | 2% | 7945 | 916500 | 59,2% |
| Samsun | 1003 | 2% | 7945 | 916500 | 59,2% |
| Şanlıurfa | 992 | 2% | 1890 | 300125 | 41,9% |
| Sakarya | 987 | 2% | 2637 | 293280 | 33,9% |
| Manisa | 901 | 2% | 2777 | 325000 | 29,4% |
| Diyarbakir | 866 | 1% | 2191 | 332640 | 39,0% |
| Eskişehir | 819 | 1% | 2764 | 312000 | 27,4% |
| Denizli | 595 | 1% | 2923 | 362880 | 27,5% |
| Malatya | 593 | 1% | 2090 | 332180 | 27,5% |
| Yalova | 592 | 1% | 2921 | 338875 | 24,4% |
| Kahramanmaraş | 586 | 1% | 2304 | 343840 | 39,1% |
| Elâzığ | 450 | 1% | 2097 | 342210 | 19,8% |
| Trabzon | 450 | 1% | 2429 | 368000 | 23,0% |
| Ordu | 449 | 1% | 2494 | 316170 | 27,8% |
| Çanakkale | 437 | 1% | 3499 | 365142 | 33,4% |
As we can see, only in one of the 30 provinces mentioned, the price increase was less than 20 % per year (Elâzığ from 19.8 %). In most cases, this is at least plus a quarter of the cost (Istanbul, Ankara, Bursa, Kocaeli, Tekirdağ, Yalova), mainly an increase of 30% or more. And some provinces have an increase of 45% or more, such as Antalya (45.7 %), Aydın (56.2 %), Muğla (59.2 %).
THE UNDISPUTED LEADERS OF THE "PANDEMIC YEAR" ARE SUMMER HOUSES WITH A GARDEN
For more than a year, many people have been spending a significant part of their time at home, studying and working remotely. So, the housing, which was traditionally considered summer in Turkey and was intended for holidays, turned into a year-round one in a matter of months. Both for rent and sale, now it is not only in high demand, but also in great demand.
We have already told about villas and detached houses in resorts, but the coastal areas near the key metropolis of Turkey, Istanbul, also deserve to be mentioned. Since many people prefer not to leave hundreds of kilometers from their main city of residence, due to the need to regularly visit Istanbul for work, etc.
So, “houses by the sea near the metropolis” came to the fore. From the settlements neighboring Istanbul, Şile was mostly famous, but now Silivri and Trakya are quickly becoming popular. And since Istanbul stretches for kilometers along the shores of the Bosphorus, houses on the coast with sea views, and especially villas and mansions, are becoming famous.
Now there are about 600 mansions located on both sides of the Bosphorus Strait in the metropolis. Despite the fact that in previous years 2-3 mansions on the shore of the Bosphorus were sold on the coast of Istanbul, we expect a record this year. Dozens of such transactions were made only during the pandemic. There was a special demand for them from foreign investors who appreciated the benefits of such an investment. Although it is necessary to approach the issue carefully: many of these houses are "with history", and it is necessary to consult the Monuments Department and the Bosphorus Strait Zoning Department regarding the status of these real estate objects.
As for the prices of such housing, the mansions and apartments for sale in them range from 20 to 750 million Turkish liras. The amount of rent for houses with a private terrace and garden in the Istanbul area, which was kept at the level of 150-160 thousand Turkish lira before the pandemic, has now reached 200-250 thousand. But even despite this, it is very difficult to find a mansion for rent now: they are sold out.
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TURKEY GETS THE LEVEL OF EUROPE IN TERMS OF HOUSING COSTS
The increase in demand for housing in Turkish resorts has allowed the country to compete even with the most popular European cities in this sense, having equaled them in price not only in the province of Muğla. According to the consulting firm Tranio and Savillas, in Europe, on the Cote d'Azur, luxury villas with an area of 330-650 square meters, with 5-10 bedrooms, sea views and swimming pools cost from 11 to 15 million euros (113-155 million Turkish lira), and with a smaller square footage from 4 million euros. For example, in Nice, you can find a luxury apartment for just 1.2 million euros (less than 15 million Turkish lira).
In Barcelona, Spain, it is really possible to buy an elite apartment with an area of 72 to 126 square meters for 490 thousand euros (5 million liras) to 695 thousand euros (7.06 million liras), and in Ibiza for 565 thousand euros (about 6 million liras).
If you have the desire and the opportunity, it is high time to buy a house in Turkey. Moreover, housing is successfully rented, and interest rates on housing loans compare favorably with Russian ones, because they start from only 1.32 %.