Property sales to foreigners make huge leap in mid-2018

The number of properties sold to foreigners surged by 23 percent year-on-year in the first half of 2018. Iraqi, Saudi and Iranian citizens purchased onethird of some 11,816 units that were sold to foreigners in this period

THE INTEREST of foreigners in Turkey’s real estate sector has maintained its upward course, as the country saw property sales to foreigners increase by 23 percent in the January-June period this year compared to the same period last year, the national statistical body announced yesterday. Foreign citizens purchased 11,816 houses from January through June, according to the Turkish Statistical Institute (TurkStat). This figure was 9,378 and 9,595 in 2016 and 2017, respectively. Istanbul – the country’s largest city by population and one of its top tourist draws – enjoyed the lion’s share of sales to foreigners, with 33 percent (3,990 units).

was followed by the holiday resort city of Antalya with 2,883 properties, while the northwestern province of Bursa ranked third with 812 houses sold in January through June this year.

Iraqi citizens topped the list in terms of nationalities with 1,987 properties, followed by Saudis (1,087 units), Iranians (944), Russians (815) and Afghans (719).

Meanwhile, the overall number of residential properties sold in the country dropped 1.3 percent year-on-year to 646,032 in the first six months of this year, TurkStat reported.

Some 298,877 houses were sold for the first time from January through June while the rest were second-hand sales, TurkStat reported.

The number of new mortgages slipped in the first half of this year – down by 18 percent to 210,805 compared to the same period last year.

House sales with mortgages took a 31 percent share of all house sales in Turkey. Currently, the mortgage rate for 120 months is between 1.3 percent and 1.8 percent per month.

HOUSE SALES UP 22.4 PERCENT IN JUNE

In June, 119,413 houses changed hands, up 22.4 percent compared to the same month last year. The same figure was 97,579 in June 2017.

According to the TurkStat statement, Is- tanbul had the highest share of house sales in June at 17.2 percent and 20,547 houses sold. It was followed by Ankara with 12,078 house sales and İzmir with 6,888 house sales, while the share of the two cities stood at 10.1 and 5.8 percent, respectively.

First house sales in the country stood at 57,064, up 25.6 percent compared to the same month the previous year. First house sales had a 47.8 percent share of all house sales in Turkey. Second hand house sales reached about 62,349, an increase of 19.6 percent year-on-year, the data shows.

House sales to foreigners increased 7 percent year-on-year, reaching 2,060 units in June. Istanbul again led the way: 746 houses sold to foreigners, followed by Antalya with 525, Bursa with 117, Ankara with 83 and Yalova with 74.

Iraqi citizens ranked first among nationalities with 315 houses bought in June, followed by Iran with 228, Russia with 169, Afghanistan with 139 and Saudi Arabia with 110 house sales.

Monthly mortgaged house sales reached 47,648, an annual increase of 35.3 percent in June. House sales with mortgage had a 39.9 percent share of all house sales, according to TurkStat. The number of property sales rose 5.1 percent in 2017 compared to the previous year, according to TurkStat data.

House sales in 2017 exceeded the record for 2016, as more than 1.409 million residential properties were sold last year compared to 1.341 million units in 2016.

Last year, Istanbul had the largest share of house sales with 16.9 percent, or 238,383 houses. Official data shows that property sales to foreigners rose 22.2 percent year on year in 2017 with Istanbul the number one province with 8,182 sales.

The Mediterranean resort city of Antalya was number two, with 4,707 sales to foreigners, followed by Bursa with 1,474 and Yalova with 1,079.

TurkStat data shows the largest number of house sales by nationality went to Iraqis, who bought 3,805 houses in 2017, followed by Saudis with 3,345, Kuwaitis with 1,691, Russians with 1,331 and Afghans with 1,078.

Sector representatives said that despite the drop in the first half, the most significant factor driving the increase of 22.4 percent in house sales for June was the low interest rate provided by public banks.

Public banks lowered housing loan rates to 0.98 percent as of May 10. Moreover, reductions in the value-added tax (VAT) and title deed fees by the government also contributed to the increase in the discount campaign launched by the sector.

Evaluating statistics for housing sales to foreigners, Sur Yapı and the Association of Housing Developers and Investors Chair Altan Elmas stressed that the interest of foreign real estate investors in the Turkish market is growing continuously and said, “I think that 2018 will see a record in the number of real estate properties sold to foreign citizens.” She further cited the reciprocity law that grants citizenship to foreigners who buy real estate properties worth $1 million but stressed that sector professionals want to reduce this figure to $300,000.

Real Estate and Real Estate Investment Trusts Association (GYODER) Chairman Feyzullah Yetgin said in a written statement that the surge in property sales in June was stimulated by campaigns that reduced interest rates on real estate loans below 1 percent.