Foreign interests spend $10 billion in 5 years for real estate purchases
Tuesday, February 26th, 2008Foreign interests spend $10 billion in 5 years for real estate purchases
The political and economic stability resulting in foreign interest in the property market boosted the construction of new sites between 2002 and 2007.
Recent political and economic stability as well as efforts by the Justice and Development Party (AK Party) to increasingly integrate the Turkish economy into global business have led foreign interests to invest their wealth in Turkey.
In the five-year period from 2003 through 2007 the value of real estate purchases by foreign interests was approximately $10 billion, recent Undersecretariat of the Treasury figures have shown.
The surging interest in real estate was accompanied by increasing amounts of foreign direct investment (FDI) in the given period, with capital inflow surpassing $18 billion per year. The amount of money brought in by foreign interests for real estate acquisition was $998 million in 2003 and has increased steadily since then, rising to $1.34 billion in 2004, $1.84 billion in 2005 and $2.9 billion in 2006. The amount increased slightly in 2007, too, by reaching $2.95 billion despite domestic and international economic uncertainty.
The main factors contributing to foreign interest in the Turkish real estate market are relatively low prices, increasing income levels and production, and positive expectations vis-à-vis real estate prices.
According to a report titled “Real Estate Acquisitions of Foreign Real Persons” released by the General Directorate of Land Registry and Cadastre, people from 70 nationalities purchased fixed property such as land and houses. Among them, the citizens of Germany, the US, Austria, Azerbaijan, Belgium, Denmark, the Netherlands and France predominate. They usually prefer İstanbul and Antalya, as half of the money is invested in these two cities. These cities are followed by Bursa, İzmir, Muğla, Hatay, Aydın and Mersin.
FDI and real estate acquisitions did not have a bright outlook in the year preceding AK Party governance, as they primarily stayed below $1 billion. Along with stability, efforts to join the European Union have rendered Turkish markets attractive investment areas. In the five years since 2003 the total amount of FDI has surpassed $46 billion. The annual amount of such capital inflow is expected to increase even further this year and the years to come.
| Real estate presents opportunities for foreigners* |
Source:Todayszaman