Surging Real Estate Prices in 2023: Turkey Leads with a 133% Increase
Explore the factors behind the 133% surge in Turkey's housing market during 2023 and learn what this means for international investors looking to buy property.
Turkey Leads Global Real Estate Growth
The global housing market changed fast in early 2023. Turkey became the clear leader in property value growth. The Knight Frank Global House Price Index tracks 56 countries. It showed Turkey had a 132.8% price jump compared to 2022.
This growth beat every other market by a lot. North Macedonia came in second with an 18.8% increase. Other countries like Croatia and Hungary saw growth around 17%. But Turkey’s triple-digit rise set a whole new record for real estate for foreigners.
Source: Euronews
Top Cities for Real Estate for Foreigners: Ankara, Izmir, and Istanbul
You’ll see the biggest jumps in Turkey's major cities. A study of 150 global cities put three Turkish hubs at the top of the list. Ankara led the world with a 135.3% price hike. Izmir followed at 133%, and Istanbul hit 127.3%.
If you need a closer look here, see 122 thousand 768 houses were sold in Turkey in May, Russians bought the most houses among foreigners.
If you need a closer look here, see Regional Powerhouses: Istanbul, Ankara, and Izmir.
Other famous cities grew much slower. For example, Tokyo only saw a 7.5% rise. Demand in Turkey stays high because people are moving to cities quickly. Plus, there aren't enough new homes being built to keep up.
Source: Euronews
Real Growth vs. Inflation
Understanding the difference between nominal and real growth is key. Nominal figures show the raw price increase. Real growth accounts for inflation. Turkey has faced high inflation, which pushes property prices up. But even after adjusting for those costs, the market looks very strong.
Between late 2021 and 2022, the real price increase was 51%. By June 2023, real value growth stayed at 38%. So, the market isn't just rising because of currency issues. It’s rising because people actually want to buy homes.
Global Winners and Losers in 2023
Turkey and parts of Eastern Europe did well, but other big economies struggled. High interest rates made many markets cool down. Greece and Bulgaria saw growth near 10%. Japan stayed steady at 6.8%.
But Western markets started to stall. The US only grew by 0.7%, and France saw 2.7%. Some countries even lost value:
- Germany: -1.0%
- United Kingdom: -3.1%
- Sweden: -8.8%
These drops show that investors are now looking at emerging markets with better returns.
Why the Turkish Housing Market is Booming
A few things caused this record-breaking year. Building costs are high, so fewer new houses exist. This creates a supply shortage. Also, many locals use real estate to protect their money from inflation.
Foreign buyers help too. Turkey is still a top choice for people wanting a residence permit or high rental yields. This mix of local and international interest keeps the market moving fast despite global economic shifts.
Future Outlook for Real Estate for Foreigners
Data from the Central Bank shows growth peaked in late 2022. The pace slowed a bit in 2023, but prices are still going up. For you, the best move is looking at long-term value. Focus on rental income in busy cities like Ankara or Istanbul. This makes real estate for foreigners a solid choice for the future.
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About Hamit Ekşi
Expert real estate consultant specializing in Turkish Citizenship by Investment programs.
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