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Housing Market in Turkey

Published on Mar 13, 2025
Kourosh Soleymani

Navigating the Current Housing Market in Turkey

Challenges in the Under-Construction Property in Turkey

Under-construction properties in Turkey have become less appealing to buyers for several reasons:

Higher Prices Compared to Ready Homes:
Many under-construction properties are priced 20-30% higher than brand-new, ready-to-move-in homes in the same location. This lack of price competitiveness has diminished their appeal.

No Motivation to Wait:
Buyers are reluctant to invest in properties that are not yet complete, especially when they can purchase similar-quality homes at lower prices without the waiting period. For instance, in Istanbul’s Esenyurt district, ready homes are priced at 2,000 USD per square meter, while under-construction properties are priced at 2,500 USD per square meter.

Flexible Payment Plans:
Despite the drawbacks, under-construction housing market in Turkey often come with attractive long-term installment plans and zero-interest payment options. Builders, struggling to sell in a slow market, offer these terms to attract buyers who lack the cash for upfront payments.Example: Buyers can purchase under-construction homes with down payments as low as 10% and installment plans spread over 60 months without interest.

Rental Housing Market Issues in Turkey

Owning rental properties in Turkey comes with its own set of issues, driven by government regulations and economic conditions:

Tenant-Favorable Laws

Turkish laws heavily favor tenants, making it difficult for landlords to increase rents according to inflation. For example, in 2024, the legal cap on rent increases was 25%, while inflation exceeded 50%.
Evicting tenants can also be a lengthy and challenging process, with courts often siding with tenants. On average, eviction cases take 12-18 months to resolve.

Short-Term Rental Restrictions

Unlike in the past, short-term rentals through platforms like Airbnb are now heavily regulated. Homeowners can only rent their properties short-term up to 4 times per year and must obtain a license to do so. The cost of licensing is approximately 5,000 TRY annually.

Increased Taxes on Rental Income

Taxes on rental income have increased significantly. For example, rental income above 880,000 TRY annually is taxed at 40%, making it less profitable for property owners.

Housing Market in Turkey : Trends and Buyer Behavior

The poor housing market in Turkey conditions are not only discouraging foreign buyers but also deterring Turkish citizens from investing in real estate:

Preference for Bank Deposits:
With Turkish banks offering interest rates of 25-30% annually, many locals prefer to deposit their money and earn risk-free returns. For example, depositing 1,000,000 TRY in a bank can yield an annual return of 300,000 TRY, which often exceeds rental income.

Decreased Demand:
The combination of legal and economic factors has led to a 25% decline in property transactions compared to the previous year. As a result, many property owners are reducing prices by 10-20% to attract buyers.

Opportunities in Turkey’s Real Estate Market

Despite the challenges, the current housing market in Turkey offers unique opportunities for savvy investors:

Discounted Prices on Ready Homes:
- Many ready-to-move-in homes are being sold at discounted prices due to low demand. For instance, properties in Antalya that were priced at 3,500 USD per square meter last year are now available for 2,800 USD per square meter.
Long-Term Investment Potential:
- Real estate markets are cyclical. By purchasing properties at low prices now and waiting for the market to recover, investors can achieve significant returns. Historically, Turkish property prices have increased by 8-12% annually in recovering markets.
Cash Buyer Advantage:
- Sellers are more willing to negotiate with cash buyers. On average, cash buyers can secure properties at prices 10-15% below market value.

Statistical insights of housing market in Turkey

To better understand the market, let’s look at some key statistics:

Property Type	Price (USD per m²)	Payment Plan	Availability
Ready Homes	2000 - 3000	Full Cash Required	Immediate
Under-Construction	2500 - 3500	Installments (60 mo.)	6-24 Months

Rental Income Tax Rates (%)

Annual Rental Income (TRY)

Recommendations for Real Estate Investors in Turkey

Avoid Under-Construction Properties:
- Unless you need a flexible payment plan, prioritize ready homes for better value and immediate use.
Invest in Ready Homes:
- Focus on discounted ready-to-move-in properties in desirable locations for long-term gains.
Adopt a Long-Term Strategy:
- Treat your investment as a long-term plan. The market’s recovery will reward those who buy at low prices now.
Work with Experts:
- Navigating the Turkish market requires knowledge and experience. At Homes Gravity, we offer tailored advice to help you make the right decisions.

Final Thoughts

While the Turkish real estate market is facing difficulties, it also presents golden opportunities for smart investors. By understanding the challenges and leveraging the current conditions, you can position yourself for future success.

If you have questions or want to explore investment options, contact Homes Gravity today. We’re here to guide you through every step of your real estate journey in Turkey.

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