by FSBO 
Is Turkey still a safe place for your investment? Should you buy real estate in Turkey? Or is it time to sell property in Turkey fast and get out before the political situation turns any worse?
Recent developments in Turkey, such as the failed military coup and the series of terror attacks are certainly a cause for concern.
The Turkish government knows about this and has been offering incentives to foreigners who might want to invest in the country. Last week, Turkey introduced a new law that offers immediate citizenship to foreigners who buy properties worth $1 million in the country.
Foreigners who make a fixed capital investment of $2 million in Turkey or create 100 jobs will also be granted citizenship. Ugur Civelek, a prominent economist and columnist from Turkey said that these changes were made to increase foreign investment in real estate, which is one of the biggest contributors to the Turkish economy.
Mr. Civelek, said in an interview with Al Jazeerah: “The excess supply in the real-estate market creates vulnerabilities in the country’s financial sector. The real estate’s share in total bank loans is very large and keeps on increasing. A sharp fall in the real-estate business might push the Turkish economy into debris.”
Mr. Civelek added that the Turkish government was using the citizenship offer when the Turkish currency, the lira, was losing value, hoping to encourage foreign investment in the country.
“With this move, Turkey aims to attract more foreign financial resources, which it is lacking, into the country and ease the excess supply of real estate. In terms of foreign currency, the real-estate prices have decreased significantly in Turkey [because of the fall of lira]. The expectation is to attract demand in such an environment,” Mr. Civelek said.
The Turkish lira has dropped more than 10 percent in value against the US dollar in the first 3 weeks of 2023. This is certainly not a good sign. This follows a 17 percent decline against the US dollar during 2022.
Still, the real estate market in the country has been doing pretty well. Properties in Turkey have much sought after. Turkey is considered to be the hottest overseas property market in the world. Property prices here have witnessed a double-digit growth every year for the last decade and a half. This is astonishing.
It’s no surprise that there are a number of foreign buyers who are eager to invest in properties in Turkey. Middle Eastern buyers or wealthy Arabs from Saudi Arabia, Iraq and Kuwait are amongst the biggest buyers of Turkish properties.
Russians have invested heavily in Turkey, but Russian involvement dropped a bit during 2022 following a prolonged period of political tension between the Turkish government and the Russian administration.
However, there is no question that foreign interest in Turkish real estate has dropped a little because of the political turbulence and terror attacks, and the pandemic. Hopefully, 2023 will be a more peaceful year in Turkey and bring its economy and the property market back on track.
