Due to inflation, increasing demand, and growing costs of construction, property prices have doubled in Turkey.

1. Turkey Faces Largest Property Crisis in Its History – Here’s Why
Over the course of 2022, Turkey has faced one of the most significant property crises in
its history. According to a report from the nation’s Central Bank, house prices nearly
doubled on average between February 2021 and February 2022. In some places, such
as Istanbul, prices more than doubled. Some of the largest increases were in parts of the
country considered among the least developed, such as Sanliurfa and Diyarbakir in the
Southeast.
These price increases stem from the increasing costs of construction, as well as the
current imbalance between supply and demand. There, demand still significantly
outstrips supply, which means that developers can sell at a premium. This premium is
placed on top of the higher costs of materials, which themselves have nearly doubled.
Turkey also faces incredible rates of inflation, as high as 61 percent in March 2022.
Alienating the Turkish Middle Class from Property Ownership
These price increases have had the strongest impact on the middle class in Turkey.
Economists have shown that increases in salaries in Turkey meant to combat inflation
have been only a fraction of the increase in housing prices. Families who formerly were

2. able to purchase homes now have no option other than renting, especially in the more
competitive markets.
This issue has also affected developers. For example, Kiptas is a construction company
in Istanbul that provides subsidies to build affordable houses for lower- and middle-
class families. However, with the average apartment costing nearly $100,000 USD, even
middle-class families can no longer afford these homes.
In Turkey, the monthly minimum wage is $290 USD, which means that a low earner
would need to work for almost 30 years just to buy an average apartment. Of course,
this assumes that the person puts all money earned toward the home and that inflation
does not get any worse than it currently is. Since neither of these scenarios is realistic, it
is virtually impossible for low earners to buy in the current economic climate.
Additionally, prices only continue to increase, so people who can already barely afford a
home may see costs exceed their budget during the course of their housing search. This
can happen in a matter of months in the current market.
Increasing Rents Drive Turks from Their Homes
The real issue is that people in Turkey who cannot afford to buy may likewise not be
able to cover rent. The property prices in Turkey have also impacted the rental market,
with rents also increasing dramatically. Some people have reported rent hikes that
more than double the monthly cost, which is simply not something that most families
can afford.
Turkish law says that landlords cannot increase rent of current tenants more than the
annual rate of inflation, so legal battles have been on the rise in recent months.
Landlords want to re-rent at market rates and tenants are resisting, as they cannot
afford the increase.
Lawyers in Turkey have been working with people to inform them of their rights and
help them advocate for themselves. However, Turkish law also lets landlords amend
leases after five years, so there is not much of a battle in some cases. This means that
people have been forced to leave their apartments so that landlords can rent them at a
higher rate.

3. Many Turkish families are moving in together to make rent more affordable. This only
raises tensions, especially as people formerly in affluent areas relocate to cramped
quarters in less desirable neighborhoods. Even with this move, rents can still be quite
high.
Growing Resentment toward Foreigners in Turkey
The property crisis in Turkey has caused some nationals to get angry with expatriate
investors. Indeed, the Turkish government has specifically marketed Turkish real estate
to foreign investors to bring money into the country. The problem is that this drives the
displacement of Turkish people. Some individuals have now started calling on the
government to stop sales of real estate to foreigners all together.
Citizens' frustration is also aimed at refugees, many of whom are repatriating in Turkey
and using their foreign money to purchase real estate. With a large population of
foreigners now residing in Turkey, foreign money has certainly played a role in driving
prices.
Turkey currently offers citizenship to any foreigner who purchases a property worth
$400,000 USD or more. Within the past decade, $41.3 billion USD in Turkish property
has been sold to foreigners. For its part, the Turkish government has gently encouraged
refugees in the country to consider going home, especially if the situation has changed.
This encouragement is particularly aimed at Syrians. Many Turkish people see Syria as
a safe country that refugees can now return to should they wish. Because of the conflict
between Ukraine and Russia, Russians have also now been moving to Turkey and
investing in real estate, which only serves to increase prices further and amplify
resentment of foreign investment.