Why House Price Increased in Istanbul 2022?
There are a few reasons why house-price increases in Istanbul have been so spectacular. First, there is a lack of new stock. Therefore, sales are largely made up of resales and old stock. As a result, older stock does not appreciate as much as new stock. In contrast, the Bomonti neighborhood in Sisli has seen a huge increase in price – over 50% in USD terms.
Turkey’s real estate market is growing faster in the primary market
In recent years, the government has eased the rules for foreigners to become citizens of Turkey and purchase real estate. This move has led to an increase in Turkish real estate sales. In addition, a new tax exemption from VAT and reduced Land Registry fees have also spurred demand. Before this, foreigners had to pay million to purchase real estate in Turkey. However, this threshold was reduced to $250,000 this year. In addition, in May, the minimum threshold for citizenship was set at $400000.
New infrastructure projects are also helping to drive real estate prices higher in Turkey. The construction of the Istanbul Canal is one of these projects. These projects are expected to boost tourism in the region. As a result, Turkish real estate prices are projected to increase significantly over the next five years.
Rental prices are increasing faster in the primary market
A recent study by the government suggests that rental prices are rising more rapidly than the national average. In Istanbul, for example, rental prices have doubled since last year. This is in line with the country’s recent increase in the inflation rate, which is over 70 percent. But the rise has sparked a debate over the credibility of official statistics. While some experts believe the data is reliable, others have doubts.
The city of Istanbul is home to around 15 million people, and this number is only expected to increase over the next few years. This is largely due to favorable demographics throughout Turkey, which will further propel the city’s urbanization and increase its population. According to the World Bank, Turkey has a fertility rate of 2.1 children per woman, which compares favorably to Greece.
Turkish government increased investment limit of Turkish citizenship by real estate
Turkish citizenship by investment can be acquired by investing in real estate worth US$400,000 or more. In addition, a person must also open a bank account in Turkey. Once the necessary paperwork is completed, the government screens the application. It may even require an interview. After the application has been approved, citizenship documents are issued to the applicant and any dependent family members.
The investment limit is US$400,000 per applicant, or US$145,000 per family of four or five. The investment must be maintained for five years to be eligible. The investment limit is increased if the applicant has a spouse or minor children. In order to acquire citizenship, the applicant must invest the required amount in a Turkish real estate project approved by the Turkish government.
Impact of price increase on rental prices
An increase in inflation has been blamed by many economists for the weakening of the Turkish lira. According to the latest figures, Turkey’s average rent increased by 19.6% a year in the year to March 2022. This increase is higher than the 1.3 percent rise in rent in the EU in the same period. This is despite Turkey’s rental laws, which favor landlords over tenants.
The COVID-19 pandemic had a negative impact on the Turkish rental housing market. Before the pandemic, the average unit rent price was lower. However, it increased after the epidemic. This increase is likely linked to the uncertain environment created by the pandemic.