According to the international consulting company Knight Frank, the real estate price index in Turkey in 2021 increased by 32.4%, thereby strengthening the republic’s title of the world leader in the growth of housing prices.
What is the reason for this tendency to increase the cost of square meters, we propose to figure it out.
Lack of land
The main reason for the rise in the cost per square meter in Turkey is the rise in the cost of land. Before starting the construction of a residential complex, developers are looking for a free land plot for building. Every year there are fewer and fewer such plots. Accordingly, this also affects the cost of each free one hundred square meters.
The lack of land resources is especially felt in densely populated cities and regions. In cities such as Alanya and Antalya, it is becoming more and more difficult to find an undeveloped plot, and if there is one, they ask for a price for it, which can often reach six zeros in the check. Accordingly, with the rise in prices for land plots, the price tag for real estate also rises.
Figures: Over the past year, the cost of land in Turkey has grown by an average of 20%. Land plots with direct access to the sea have almost doubled in price.
Rising prices for building materials
Over the past year, the cost of building materials has grown by one and a half times. This is caused by inflation, as well as interruptions in the supply of raw materials and finished goods from abroad during quarantine restrictions.
Figures: Developers note that the price of one of the main materials – cement, has grown from 160 TRY to 285 TRY per ton, and iron – from 3500 TRY to 5500 excluding VAT.
This led to an increase in prices per square meter in new buildings. For the entire 2021 in the primary sector, the price tag has changed by 15.36% upward.
High demand for real estate
Another factor that influences the rise in the cost of housing is stable consumer demand. Even the pandemic has not changed the desire of foreigners to invest their savings in Turkish real estate.
Figures: For 8 months of this year, 801,995 transactions for the re-registration of real estate were registered. At the same time, the sale of housing to foreigners increased by 47.6% compared to the same period last year and amounted to 30,849 units.
Changing building standards
In the past few years, the approach to the construction of apartment buildings has changed significantly in Turkey. Construction is carried out not according to standard, but according to individual projects, which allows each individual complex to stand out in a fairly competitive real estate market. Eminent architects are often invited to develop projects.
Attracts foreigners and infrastructure, which is available in almost every new residential complex. In a closed area there are usually: a swimming pool, a sauna, a gym, a children’s playground, a small garden, a parking space. And, what is remarkable, the range of additional services is only expanding every year, and this also affects the cost of living space.
Figures: Apartments on the Alanya coast with an area of ​​100 m2 in a modern residential complex cost about 60 thousand euros. And their value will only grow. Apartments with similar parameters in a complex without additional services will cost 30% cheaper, and it is difficult to call them liquid, since the demand for them is low.
Favorable financing terms
You can buy real estate in Turkey without even having all the money. Turkish banks are willing to lend to foreigners, and developers offer interest-free installments. At the same time, both the first and second procedures are maximally simplified to a minimum and therefore there is no need to prepare a large package of documents.
Figures: A mortgage loan in the amount of 40-60% of the appraised value of housing is issued for a period of up to 10 years at 6-8% per annum in dollars or euros. Developers offer payment by installments for the entire construction period at 0%, with an initial payment of 10-30% of the value of the object.
The dynamics of growth in property prices in Turkey will continue to maintain this trend. Therefore, people who are planning to buy real estate on the seashore in a sunny republic should hurry up. On the website of the real estate company Status Property, you can familiarize yourself with the current offers on the market, and managers are always ready to guide you on the procedure for buying a home.
