Foreign Ownership In Turkeys Real Estate Is 25 Billion Dollars
News Posted On: 06 March 2014
Foreign capital was not a welcome idea when modern Turkey was founded. The legislation involving foreign capital was conservative, and utilizing foreign debt, especially from Western countries, was not a popular consideration for the Republican body.
Up until 2003, the sale of buildings, houses or land to foreigners was unheard of due to strict legislation, only to be changed by the Justice and Development Party or AKP when it rose to power.
Amendment of legislation welcomes foreign buyers
The AKP government, which started exercising its power back in 2002, did not hold back on privatization projects. Along with this, the 'real-estate sale to foreigners' legislation was also liberalized in 2003. The Land Register Law's Article 35, was amended to pave way for foreign investors to step into Turkey's property market.
While property sales to foreigners was under one billion dollars in 2003, once the legislation was changed, the numbers started going up, reaching three billion dollars in 2013, making it 25 billion dollars on the whole.
During AKP's stint, the privation income obtained was seen to be 50 billion dollars. When compared to this, the 25 billion dollars from real-estate foreign sales is outstanding. Although it is no where in comparison to the revenue obtained from tourism and exports. The annual exports in 2003 and last year, reached nearly 106 billion dollars, while the real-estate foreign sales revenue was a meager 2.2 percent of the exports revenue.
While the sales in properties through offices, land and houses in the 11 year period is about 25 billion dollars, the revenue from tourism comes up to 196 billion dollars. Either way, coastal provinces saw a drastic improvement in the real-estate and construction spaces. Foreigners showed special interest in coastal province properties and resort developments.
While this has no doubt boosted Turkey's real estate market, the growht in construction has caused environmental issues and unplanned urbanization. The unregistered foreign property management has also sprouted concerns, while foreign owners trying to get their hands on unregistered revenues from tourism have met with criticism too.
Foreign housing sale statistics
Statistics say that of the 1,157,000 total unit sales in 2013, foreigners bought 12,181 units, which is a little over one percent of the total housing sales. The housing sales in January this year were about 88,000 units of which, foreigners bought 1,207 units, keeping it at the one percent margin again. What's interesting is, nearly half of the 12,000 unit sales made by foreigners in 2013, occurred in Antalya, while Istanbul saw 2,447 units sold off.
The remaining places which saw enthusiasm from foreign buyers were the Kusadasi district in Aydin and provinces in Mersin, Mugla and Bursa. The last 11 years, among foreign owned properties Antalya has a 30 percent stake, Mugla a 14 percent share, Aydin Istanbul a 11% stake each.
Among these overseas owned properties, Germans bought 51 percent, British 10 percent, Austrians 10 percent, and the Greeks five percent. This means that nearly three quarter of the total sales have come from European citizens.
Written by Les Calvert of www.property-abroad.com
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