Real Estate

2025 action plan announced for real estate sales to foreigners

While the 1st Ordinary General Assembly of the Real Estate Overseas Promotion Association was held, the “Real Estate Exports 2025 Strategic Action Plan” was introduced within the scope of the meeting.

Speaking at the opening of the event, Vice President of the Presidency Investment Office Ahmet Ihsan Erdem said that Turkey, with its strong and well-founded economy, offers diverse opportunities to meet the changing needs of international investors after the epidemic.

Stating that Turkey is currently a production, investment and R&D base in many sectors from automotive to pharmaceuticals, from petrochemicals to machinery, from real estate to financial services, from food to informatics, from aviation to defense, Erdem talked about the advantages offered by Turkey.

Noting that the construction industry has a significant share in Turkey’s growth performance in recent years, Erdem continued as follows:

“Especially with the public investments realized in every field, the construction sector maintains this position. In 2020, the share of the construction sector in GDP was 5.4 % and the share of real estate activities was 6.2% . When we look at international direct investments, we have the opportunity to emphasize once again how important the real estate sector is for our country. As a country, we have attracted a total of $225 billion of international direct investment since 2003. $57 billion of this is made up of real estate investments.”

Erdem explained that with important developments such as the Reciprocity Law and the right to citizenship, real estate sales to international investors gained momentum.

“Let the sale of real estate to foreigners be considered exports”

Istanbul Chamber of Commerce (ITO) President Sekib Avdagic stated that the real estate investment target of $20 billion set by the Real Estate Overseas Promotion Association (GIGDER) for 2025 is modest. “We are targeting $10 billion of foreign investment income by selling 40 thousand houses in Istanbul for 2025, with a unit price of $250 thousand.”

Talking about the expenditures made by the foreigner who buys real estate and voicing that the investment increases with the housing, Avdagic said that most of the foreigners who buy real estate in Turkey are also volunteer ambassadors of this country.

Stating that the income from real estate sales to foreigners is very important, Avdagic said, “We request your very special support (dedicated to Nureddin Nebati, Deputy Minister of Treasury and Finance) for this activity to be counted as an export. This is a very important and direct income.”

Explaining that Istanbul lags behind European metropolises in real estate prices, Avdagic emphasized that steps should be taken to move Istanbul to a more valuable and valuable point in the medium and long term.

Addressing the delays in real estate sales to foreigners, Avdagic called for the acceleration of the process in this regard.

2025 target in real estate sales to foreigners is $20 billion

Omer Faruk Akbal, President of the Real Estate Overseas Promotion Association (GIGDER), said that they believe that the Real Estate Exports 2025 Strategic Action Plan will carry the annual property sales revenue to foreigners, which was $6 billion in 2020, to $20 billion.

Expressing that they are on the eve of a bright period in which they will focus on opportunities that will strengthen the reputation of the real estate sector in the international arena and implement sustainable new policies together with value-added collaborations, Akbal said that despite the epidemic, the demand for housing from Turkey continues to increase this year.

Expressing that there was an annual increase of more than 25% in sales to foreigners in the January-May period, Akbal said, “This increase encouraged us to reach higher targets. It does not seem far away that we will see a new record in international real estate sales, exceeding 50 thousand this year, with the acquisition of social immunity through vaccination, the gradual increase in flight traffic and the performance in tourism.”

Akbal stated that they have set up their action plans under 4 main headings in order to reach the sales target of $20 billion in international real estate in 2025, “These are ‘creating a real estate export ecosystem’, ‘effective promotion’, ‘acceleration of real estate purchase processes’ and ‘providing legal rights that provide confidence’.”

“In housing investment, the British care about the location, the Germans care about the price”

Omer Faruk Akbal shared the following information regarding the results of the research titled “Why Foreign Investors Buy Real Estate in Turkey”, which they conducted together with AGS Global:

“The satisfaction rate of real estate buyers in Turkey is at a very high level of 83.2%. According to the multiple answers given by countries to the question of which features are decisive when purchasing real estate, While the UK attaches importance to the location of real estate with 83.3%, Jordan 62.1%. Iraq 75.7%, Germany 68%, Algeria 54.2% and Iran 61.5% care about price. When the multiple answers given by the countries to the question of why they prefer Turkey are analyzed, it is seen that while Saudi Arabia with 71.8%, Russia with 77.8% and Germany with 84%, a better climate is expressed. According to Iraq, it is based on trust and stability with 70.3%, and Algeria with 50% on culture, religion and social life.”

Noting that the researches are continuing at full speed, Akbal stated that they will periodically share the Housing Sales Index to Foreigners, which is a new study that will be considered as a surprise for the sector, with the public periodically.

“License requirement should be brought to intermediary institutions”

GIGDER President Akbal stated that education and licensing legislation should be established in order to prevent grievances in real estate sales to foreigners and to ensure quality service standards, and said, “We consider it very important to regulate a regulation on licensing the institutions that act as intermediaries in the sale of real estate to foreigners.”

Expressing that they will establish the GIGDER Academy for training and certification, which will be a first in the sector, Akbal said that they will start real estate promotion training for foreigners with local and international collaborations.

Akbal said, “We see ‘education’ as one of the most important issues that will carry us to the 2025 target. With the GIGDER Academy, we will have trained 5 thousand international real estate professionals who have received training and certificates to compete with their competitors in the USA and England in a period of 5 years.”

Demanding that real estate sales to foreigners be considered foreign exchange earning services, Akbal said, “The new ecosystem created by our industry following the education, certification and licensing legislation should be included in the scope of service export as a foreign exchange earning activity. All intermediary and advisory institutions engaged in foreign exchange earning activities by providing ‘real estate promotion services’ should be included in the scope of service exporters. Developer companies can be supported within the scope of Turquality for their branded residences.

GIGDER’s new term targets

Omer Faruk Akbal said that as they progress towards their 2025 targets, they will increase their effectiveness in markets where they are strong, such as Iran and Iraq, and they will start brand new communication studies in important markets such as Hong Kong, Singapore and India, which are not yet aware of Turkey.

In this context, Akbal stated that they will develop a strategy specific to each country’s expectations regarding Turkey by taking research and field studies as a reference, and emphasized that with a brand new perspective, they aim to highlight not only Istanbul and Antalya but also very different regions of Turkey.

Akbal stated that they aim to rent a promotional office in the trade centers of TIM in Dubai, London and New York by cooperating with the Turkish Trade Centers. “We dream of establishing a system in these offices where Turkish companies that appeal to the relevant markets can promote and sell hot, supported by legal consultancy and title deed services.”

Akbal said, “We think that 20% of foreign real estate investments will come from Africa, 20-25% will come from the Far East, and the rest will come from Central Asia, Europe and the MENA region. In other words, we aim to increase sales in Central Asia, the Far East and Africa at a significant level.”

Expressing that they want to establish a Dispute Resolution Center in order to detect the possible problems of foreign investors before they take them to the court process and take the necessary actions quickly, Akbal emphasized that they aim to reduce the problems by 70% in this way.

Referring to the increase in digitalization with the epidemic, Akbal added that they will focus on digital promotion activities.

Source: AA / Translated by Irem Yildiz

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