Fear earthquake in home sales to foreigners

The earthquakes centered in Kahramanmaraş, which occurred in the second month of the year and caused extensive destruction in 11 provinces, also deeply affected the real estate market.

The government, which makes it easier for foreigners to buy real estate in Turkey and grants citizenship with money, has accelerated the sale of homes to foreigners; These sales have reached maximum levels since the Covid-19 period.

These sales skyrocketed with the influence of Russian personnel working at Akkuyu and Ukrainians who emigrated to Turkey after the war; This situation increasingly had an impact on the prices of housing for rent and sale in the country.

However, it is worth noting that home sales to foreigners began to fall from December 2022 with a high number of sales of 6,300 units, especially in the second month of this year, that is, after the great destruction. caused by earthquakes. centered on Kahramanmaraş.

The city where home sales to foreigners decreased the most was Istanbul.

FELL HARD AFTER THE KAHRAMANMARAŞ EARTHQUAKE

According to data from the Turkish Statistical Institute (TUIK), while sales to foreigners decreased by 0.6 percent annually in January, this rate jumped to 27 percent in February and 38.7 percent in March, when Earthquake. This decline continued increasingly in the second and third quarters of the year.

Consequently, home sales to foreigners fell sharply in annual terms, with 60.3 percent in April, 46.9 percent in May and 69.6 percent in June. Home sales to foreigners, which fell 28.9 percent in July, fell 42 percent year-on-year in August and September.

While the share of home sales to foreigners in total home sales was 4.3 percent at the beginning of the year, this rate decreased to 2.9 percent in the ninth month of the year.

THE DECLINE IN ISTANBUL EXCEEDED ANTALYA

Housing sales to foreigners in Antalya decreased by 36.4 percent in September 2023 compared to the same month last year, falling to 1,007 units.

In the same period, housing sales to foreigners in Istanbul decreased from 1,795 to 978, or 45.5 percent.

While home sales to foreigners between January and September 2022 decreased by 29.2 percent in Antalya, from 14,656 to 10,372; In Istanbul, this decrease exceeded 54 percent.

Thus, while a total of 19,594 houses were sold to foreigners in Istanbul between January and September 2022, this figure decreased to 8,965 in the first 9 months of this year.

Speaking to Sozcu.com.tr, real estate appraisal expert Celal Erdoğdu said: “The share of foreigners in sales in Istanbul reached up to 10 percent, but after the earthquake, housing sales to foreigners in Istanbul fell to 5 percent,” he said, noting that the first factor in this drop was the big earthquake expected. in the city.

THE INCREASE IN DOLLAR PRICES ALSO AFFECTED

Erdoğdu explained that the first factor of the decline was the earthquake and the second was “the decline in demand” and said: “The third reason is that housing prices in Turkey have increased in foreign currency.”

“Foreigners who chose Turkey after the Russia-Ukraine war made the investments they needed during this period and the growing sales began to decline,” Erdoğdu said and continued as follows:

“With the increase in prices, the attractiveness for foreigners began to decrease.

While the average price per square meter of housing in Turkey was around $500 in the period 2018-2022, which was the period in which foreigners bought the most homes, the prices per square meter, which rose in the December period In 2021, they rose to $1,194 in May. 2023. “The increase in prices in foreign currency is also one of the factors that causes the interest of foreigners to decrease.”