Is it Profitable to Buy a House in Turkey?

  • 3 months ago
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When it comes to buying a house as an investment, the first obvious reason of course is its profitability. We get this question whether it is profitable to buy a house in Turkey a lot, as well. We can of course easily answer that with a “Yes!” from our experience. But let’s number do the talking instead! Firstly, we will have a look at OECD figures.

OECD Real Estate Data

Real estate investments in Turkey steadily provided high returns. This started in 2004 after property sales to foreigners in Turkey commenced. As of 2021 Q2, Turkish real estate market was by far the best market with highest returns per OECD data, as you can see from the table below. Since 2015 average real estate prices have risen almost double by %105. Turkish real estate market was well ahead of Hungary and Iceland by big margins which ranked 2nd and 3rd. World leading Turkish housing sector profitability is simply measured in terms of the difference between total buying costs and current market prices. Same OECD data proves that Turkish rent prices increased at the fastest pace in the world by 69% since 2015. Capital gains and rental revenues together make Turkish real estate market the most profitable estate market per OECD data.

Take all factors into conclusion

We must inform you at this point, however, that the increases are in nominal terms. And inflation will erode the net profit you may gain. You must also keep a close watch on currency rates to translate your net returns. Turkish currency TL has experienced steady devaluations over the last years. And real profits can only be calculated by the change in currency rates between the buying time and the selling time. We suggest you have the financial wisdom to follow not only housing prices but also fluctuating exchange rates. Therefore, you truly have high chances to make good profits even in the short term. 

IMF Data

Secondly, IMF data shows that as of 2020-Q3 annual the real house price increases in Turkey beats the rest of the world. And price increases returned 13% real profit in just one year. Below you can see the graph for comparison: 

IMF House Prices
IMF House Prices in 2020

You can calculate the rent revenue together with your profit in increased housing prices. In this case, the return on your initial investment in Turkey is high enough to conclude that buying a house in Turkey is profitable. Turkish real estate market has been vibrant for decades. And you can count on profitability over the long run.

If you come to Turkey, make some friends and ask them. They will genuinely tell you that you will never lose from real estate investment. But instead you will always gain. The clear perception of Turkish people about real estate market is that it always beats other investments. Therefore, the most reliable form of investment for Turkish people is usually real estate investment to preserve once wealth in Turkey.

Turkish Statistics Institute Data

Turkish real estate market is a historically vibrant market and it is usually easy to resell your house whenever you like. Third of all, we would like to mention the figures of Turkish Statistic Insttitue. Per Institute, as of January 2021 only a third of the total property sales were newly constructed properties. Whereas approximately the other two thirds of every sale were older properties. This finding is in line with long-term trends. According to this, about 2/3 of all property sales are older property sale in the second-hand market. This means you do not have to worry about reselling your house. Especially with this type of market dynamics and strong demand.

In addition, Turkish Statistics Institution recently published the most recent figures about this topic. And we analyzed these figures and. After the analysis, we published an article about the increasing number of house sales to foreigners, consequently. To find out more, you can read our article: Turkish Real Estate Sales To Foreigners Are At An All-Time High!

Below you can see OECD data on housing prices showing Turkish Real Estate market as the leader.

OECD Data on Housing Prices
OECD Data on Housing Prices

Investment + Rent Revenue can make you reach the best investment

Additionally, we would like to bring up a research conducted by a Turkish newspaper. This research revealed that, among other common investment options over a 10-year period, investment in USD proved most profitable at 537% return. This was followed by real estate investment profitability at 325%+rent revenue in Turkey as of April 2021. Based on this findings, when you factor in rent revenue, real estate market offers the most reliable and profitable investment option over the long-term in Turkey.

We believe these official data and other researches strongly indicate one simple thing. It is: real estate investment in Turkey is one of the best ways to preserve the value of your savings against the erosion time brings in our life. Moreover, your real estate investments most certainly will add value and will become a profitable investment in time.

Would like to discuss more about where is best to invest in real estate in Turkey for you? Feel free to ask for an initial consulting session. This session can be in person or online via WhatsAppe-mail or you send a message in our website.

For more information, feel free to contact Us!

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