Turkey Sees 22% Spike in Property Sales From Foreign Home Buyers

View from a villa near Bodrum

Turkey saw a 22% spike in home sales to foreign buyers in 2017, according to a year-end report from the Turkish Statistical Institute, or Turk Stat.

Despite Turkey’s spiral into authoritarianism under President Recep Tayyip Erdogan, foreigners continued to snap up homes in Istanbul and the capital city, Ankara—thanks in part to a new decree offering citizenship in exchange for luxury home purchases.

In January 2017, the government enacted a new initiative whereby foreigners could get Turkish citizenship in exchange for buying a home for the equivalent of US$1 million or more.

A month later, Turkish parliament sweetened the deal even further by exempting foreigner property from the national value-added tax of 18%.

Istanbul recorded the largest spike year-over-year in foreign sales, increasing 41% over 2016, according to the data.

Modern new developments accounted for part of the spike, Spot Blue, a U.K.-based property portal for Turkish real estate, said in a separate report on Monday. New projects offered “a wide range of social community features such as swimming pools, landscaped gardens and onsite fitness gyms,” said Julian Walker, managing director of Spot Blue.

“The outskirts and surrounding districts of Istanbul are also climbing in popularity as buyers are lured by lower property prices but with all the benefits of city living close by,” Mr. Walker said in the report.

Government stats show foreign buyers jumped 24% in the Mediterranean Yalova province, south of Istanbul.

The report did not break out luxury sales to foreigners, but Middle Easterners accounted for the biggest cohort of foreign buyers.

Iraqis made up the largest nationality of foreign buyers, increasing their numbers 25% since 2016, according to national statistics. Other major buyers included Saudis, who increased purchases by 77% since 2016. The number of home purchases by Qataris increased by 41%.

Europeans also increased their buying in Turkey. Sales to Germans increased 27%, and sales to Norwegians jumped 38%, according to the national data.

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