The real estate investments of foreigners in Turkey have doubled by increasing from 2 billion 621 million dollars to 5 billion dollars in the last 3 years.
The representatives of the sector have stated factors such as the passing of the reciprocity legislation, the building of properties according to the wishes of foreigners by Turkish contractors, overseas marketing activities, the increased participation in international exhibitions and the rise in value of foreign currencies against the TL as the main reasons for the increase in the real estate investments of foreigners.
Nazmi Durbakayım, the chairman of the board of directors of the Istanbul Builders’ Association (INDER), said that he expected the amount of foreign investment, which had been 1 billion 343 million dollars in 2004, to increase to 5.5 billion dollars at the end of 2015.
310 percent increase in 11 years
Durbakayım stated that foreigners had invested 5 billion 20 million dollars in real estate in the first 11 months of the year, and said, “If we take the monthly average as our basis, we can estimate that 5.5 billion dollars of real estate investments will have been undertaken by foreigners in 2015. That is the expectation of the sector for the end of the year.”
We have built properties in line with the wishes of foreigners
Durbakayım referred to the reasons for the doubling in the real estate investments of foreigners in the last 3 years, and relayed that two important reasons came to the fore in particular.
Stating that Turkish contractors have now learned the type of properties foreigners want to buy, that they had begun to make easier and quicker sales by building properties possessing the features desired by Middle Eastern and European investors.
Durbakayım added, “On the other hand, the rise in value of foreign currencies against the Turkish Lira in the last one year has mobilized the demand of foreigners, which were on standby, and led to them buying properties at lower prices. In addition to this, the concrete steps taken by the political administration on reciprocity and the important incentives given to foreign investors by it, have also supported these purchases. These developments have been voiced by the public and private organizations which are participating in overseas exhibitions more intensively, and this has resulted in the sales volume to double.”
We are receiving 0.5 percent share from the global real estate market
Gökhan İlgar, the Dubai International Real Estate Exhibition representative for Turkey, and the CEO of LMG Global Investment, stated that Turkey is a new player in the world real estate market, and argued that foreign investment, which had risen by very large amounts in the last 3 years, were still not at sufficient levels.
İlgar, who state that the annual volume of the global real estate market was 1 trillion dollars, said that Turkey had only been able to obtain a 0.5 percent share from this.
İlgar drew attention to the important reasons for the increase in foreign investments, despite the negative factors in the global economy, and said, “The principal reason is the Reciprocity Legislation. Even though this legislation was passed in 2010, its first effects were seen in 2013.”
Turkish companies are participating more in overseas exhibitions
İlgar, who emphasized that factors such as the increased interest shown by Turkish companies in overseas exhibitions and the effective marketing activities of both the public and private sectors in these types of events, had also encouraged investment in Turkey, underlined that the franchise system and the increased awareness among realtors had also made a contribution to this increase.
İlgar said, “The Dubai International Real Estate Exhibition (IPS) will be held between 11-13 April this year. It is expected that the number of Turkish companies which will participate in the exhibition, where the business volume is forecasted to reach 100 billion dollars, will increase to 50 – which is a 100 percent increase – this year. 25 companies had taken part last year. Those who have seen the investments undertaken by capital from the Gulf countries in Turkey, are going there and promoting the investment opportunities.”
Ilgar, who stated that Turkey had competition from countries such as Britain, the USA and the European countries in respect of real estate investments, emphasized the importance of participating in these organizations and promoting Turkish properties here.
Ilgar, stated that Turkey appealed to 140 countries within a flying time of 5 hours, and shared the following opinion: “Therefore, we need to use our advantage of location against our competitors, very effectively. Foreign investment will increase even more with the opening of the third Airport. The brand value will increase. And this will also have a positive impact on real estate investments.”