With elections finally over, Turkiye’s real estate market is showing signs of picking up again as companies unveil new projects they had previously put on hold.
Foreign firms are also looking at the opportunities in the local housing market after the election-related uncertainties have waned.
Foreign companies,which until today mostly engaged in property buying, now also consider developing projects in Turkiye.
There has been an increase in interest from foreign investors in the wake of the elections, according to İnanç Kabadayı, the board chair of Ege Yapı Yönetim.
“Foreign developers see huge opportunities in the Turkish market. We are in talks with companies from the Gulf and Central Asian countries to develop projects,” he said. “We will see more foreign companies in the real estate market.”
Kabadayı proposed that financing to be provided to the sector needs to be diversified.
A specialized bank should be established, and real estate investment funds could be allowed to invest in ongoing projects, Kabadayı said, adding that measures need to be taken to lower land prices, which constitute a large part of house prices, as it will help produce more houses.
The Turkish Statistical Institute (TÜİK) reported this week that the annual increase in the construction cost index slowed from 60.7 percent in March to 53 percent in April. The monthly increase was 0.9 percent.
Labor costs in the construction sector grew 0.18 percent month-on-month and 103 percent year-on-year.
The monthly and annual increases in the materials cost index were 1.4 percent and 40 percent, respectively.
In the first four months of 2023, house sales declined by 18.6 percent from a year ago to 369,000, with mortgage-financed sales declining nearly 20 percent to around 81,000.
In April alone, 86,000 homes were sold, pointing to a 36 percent decline compared with the same month of last year.