Foreigners Buy Turkish Homes at Record Pace as Lira Slides

Turkish house sales to foreigners jumped nearly 50% to a record level in November, data showed on Tuesday, bringing in billions of dollars in foreign exchange as a lira slump made purchases significantly cheaper for those buying with hard currency.

Against a background of more than 20% annual inflation, the property market was generally buoyant in November, with overall sales surging 59% year-on-year to 178,814 properties, the Turkish Statistical Institute figures showed.

“People seeing housing as a means of defence against inflation was instrumental in the sharp sales rise in November,” said TSKB Real Estate Appraisal general manager Makbule Yonel Maya, adding that lower state banks loan rates had an impact.

The lira slumped to a record low of 14.99 against the dollar on Monday, representing a halving in value this year. At its current level of 14.2 it is more than 40% weaker than at the start of September.

Altan Elmas, chairman of the Konutder housing developers and investors association, said foreign currency inflows due to house sales in the 11 months to November amounted to some $8.5 billion, exceeding its forecast.

“We can reach $10 billion by the end of the year. The biggest support for the new economic programme in the period ahead will come from property sales to foreigners,” he said.

President Tayyip Erdogan has backed aggressive interest rate cuts to support his new programme that stresses exports and credit – despite soaring inflation and widespread criticism of the policy from economists and opposition lawmakers.

The 7,363 homes sold to foreigners in November represented the highest monthly level since the data series began in 2013. By far the highest number of foreign buyers were Iranian citizens, followed by Iraqis and Russians.

Property sales to foreigners have been strong throughout the year, rising 39.4% in the first 11 months, while total house sales actually fell 9.2% in the 11-month period, compared to a year earlier.

The most popular place for house sales to foreigners was Istanbul, with 2,922 sales, followed by the southern resort of Antalya and the capital Ankara.

The data also showed November mortgage sales climbed 61% from a year earlier to 39,366, accounting for 22% of the total in the period.

Last year, sales surged due to pandemic-era cheap loans from state banks, prompting real estate developers to launch campaigns for buyers.

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