The Central Bank of Turkey has published a report for July 2024. According to new data, housing prices in Turkey in July 2024 increased by 38.7% in nominal terms compared to the same month last year. However, taking into account inflation, a key factor in the current economic situation in Turkey, a real decrease of 14.3% was recorded.
House Prices in Turkey 2024
Revised data from the Central Bank of Turkey, released 30 days earlier than usual, shows that Istanbul, Turkey’s largest city and a key engine of its real estate market, saw the lowest nominal growth among the major regions. Year-on-year, property prices in Istanbul increased by 26.8%.
On a monthly basis, the national housing price index showed a modest 0.9% increase in July.
Turkey is struggling with persistently high inflation, which is exacerbated by disruptions in global supply chains and fluctuations in energy prices. In response, the authorities have been actively tightening monetary policy since the second half of last year in order to contain inflation, which officially dropped to 61.8% year-on-year in July. It is expected that it will continue to decrease gradually.
The central bank has raised its benchmark interest rate by 4,150 basis points since June last year and maintained it at 50% since March to maximize the effect of the tightening policy.
An increase in interest rates usually leads to an increase in the cost of mortgages, car loans, and credit card costs, which affects consumer spending and borrowing.
See also: DSCR Loans: A Guide for Real Estate Investors
Situation on The Housing Market
According to the Turkish Statistical Institute (TurkStat), home sales rose to 127,088 units in July, up 16% from a year ago and the highest this year.
In the period from January to June, about 672,162 properties were replaced, which is 0.5% more than a year earlier.
Mortgage sales decreased by 20.9% in July compared to the same period last year, and by almost 54% in the first seven months.
The largest number of transactions was registered in the following cities:
- Istanbul;
- Alanya;
- Antalya;
- Marmaris;
- Izmir.
Foreign investors are quite active, buying mainly budget apartments and premium class villas, as the profitability of Turkish real estate remains high. Due to the amendments made to the legislation on short-term rental of real estate, competition in the market has significantly decreased, which allowed major players to approve approximately the same price range.
Now you can buy apartments in Turkey really profitable because problems with economy will be solved and you will get apartments or villas with high rental income.
Where to Rent Apartments for Short-Term Rent in Turkey
If you want to buy a villa in Turkey or an apartment for rent, then it is worth studying the following information:
- The most popular cities for rent are Antalya, Alanya, Kemer, Belek, Side, Marmaris, Mersin, Istanbul.
- The easiest way is to rent small apartments 1+1 and 2+1.
- 3+1 and larger properties are great for moving to Turkey or for long-term rentals.
Demands for Renting a Property for Daily in Turkey
There are several important requirements that must be observed if you plan to rent an apartment or villa for short-term rent:
- Getting consent from all the owners in the house, which can be a serious problem. In this regard, renting out villas becomes much easier. The only thing is that there is no need to coordinate with the owners if there is a separate entrance and all the necessary autonomous infrastructure.
- The presence of a sign at the entrance, which should contain contact information and a special number, which is issued by the Turkish Ministry of Tourism after obtaining a license to rent an object for short-term rent. If a person or company rents several properties in a residential complex or area at once, then you can get one general license, but each apartment or villa must have its own sign.
- The presence of fire alarms, smoke detectors, fire extinguishers and other safety equipment.
- The presence of a separate bedroom and living room. That is, studio apartments cannot be rented out on a short-term basis. There must be a functioning bathroom and a bathroom or shower.
- Each bedroom can accommodate up to 2 people. The total number of guests should not exceed 12 people.
- It is necessary to have hot and cold water in the room, bed linen in the bedroom, and furniture necessary for living.
- Cleaning and disinfection are required before the arrival of new guests.
These are the minimum requirements for short-term rentals, so many foreign investors have begun to think about the feasibility of buying a home in Turkey for this purpose and have become more interested in buying assets for long-term rentals.
