Türkiye's elections and their impact on the real estate market

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Many of the questions raised to us at the present time, especially from real estate investors, are the extent of the impact of the upcoming elections, which will be set in mid-May of this year, on the real estate investment market in Turkey and on the Turkish economy as well, and the extent of some investors' concerns about the election results, especially after the current ruling party changed to a political party. Another … MBANY Real Estate will respond to these questions and concerns through our article in order to deliver a clear picture to you regarding the elections, their results and their impact on the economic aspect and real estate investment.

Economic side :

This year 2023 is considered a watershed year for the political world in Turkey, because Turkey will have completed a hundred years and will be able to freely extract underground wealth and take wages from ships that pass through the Bosphorus Strait after it has been deprived of these rights for 100 years, that is, since the founding of the state In 1923, the Treaty of Lausanne was signed, ending the war. Where the trade balance in Turkey is considered a loser during all the past years, due to the reason that the import of energy materials is at the forefront of imports because Turkey is unable to extract them from the ground, according to the Lausanne Agreement. As an example, at the beginning of this year 2023, the total imports in Turkey amounted to about 33.5 billion US dollars, of which energy materials occupied about 25%, or 8.750 billion US dollars of the total. If Turkey today is able to extract the underground resources in a sufficient and wide manner, then it will dispense with a quarter of these imports, and it can increase its exports in the field of energy as well.

Real estate investment side :

In order to address the issue of the impact of the upcoming elections on the real estate market in Turkey, it must be mentioned that real estate investors will be divided into two parts before the elections. He is expanding his investments from now on to start reaping results after the elections. Some key points need to be discussed before deciding what kind of real estate investor would do best in these times.

The emergence of the election results and their impact on real estate prices in Türkiye :

We mentioned in previous articles that the prices of real estate or lands offered for sale in a large market such as the Turkish market depend fundamentally on the theory of supply and demand, and therefore prices will not rise unless demand for them increases, and prices will not decrease unless demand decreases. We would also like to clarify an important point, which is that the percentage of Turkish local investors who buy new real estate is not less than 95% of the percentage of the total number of real estate sold, and therefore the share of foreigners does not exceed 5% at most. There are two categories of real estate investors in Türkiye :

Turkish local investors :

If the elections take place for the Turkish investor, it will not affect his investment plans because Turkey is a democratic country, and certainly the political party that wins will have obtained the largest percentage of the people’s votes, and therefore there is no opportunity for the winning party except to present its best to maintain its position in the next elections after that. But this year, as we mentioned earlier, will be a very important year for Turkey on the economic side, and economic development will necessarily be followed by an increase in upcoming job opportunities and salvation from a large percentage of unemployment, as well as providing greater and more economic investment opportunities as they are now, which leads to an increase in demand for real estate, and this means their high prices. Hence, we find that whatever the outcome of the elections, the demand for real estate purchases from Turkish investors will increase, and therefore prices will rise according to the theory of supply and demand.

Foreign investors :

Here we discuss what interests us in the article, which is the foreign investor. There are two cases :

First case :

He who knows and realizes that success in real estate investment begins from the perspective of the local investor himself, and thus imitates the local Turkish investor, so we find that he seeks to obtain Turkish citizenship if he has an amount of 400 thousand dollars for investment and also buys in the areas desired by the local Turkish population and if he wants Renting his real estate deals with a Turkish broker and targets the local market. Even when reselling, the way out will be easy for him, and he will find that his real estate is desired by all segments of society, whether Turks or foreigners, and thus achieve successful real estate investment. This type of investor deals as local citizens deal with the issue of elections, and therefore it is now expanding its investments continuously and will soon reap the results.

The second case :

The foreign investor who insists that he is a foreigner, regardless of the size of his investments in the Turkish real estate market, and even if he has Turkish citizenship and considers that everything is temporary in this country, his focus will be: If the Justice and Development Party led by Recep Tayyip Erdogan wins: there will be stability and security in Turkey And then he will start thinking about obtaining an investment property (after prices have risen due to local demand by local investors). earnings of at least 50%. If another party wins the elections: there will be a state of great chaos that will prevail in the country, and foreign investors will be expelled, their nationalities will be revoked, and their real estate and property will be expropriated by the state without mercy!! … Do you think that a developed country with a constitution and system can have all of this?! Of course not, you are dealing with an entire country and a fixed system and not with a specific political party or a specific president. If it changes, the country will end.

We conclude from all of this :

That any result of the upcoming elections in Turkey does not necessarily have a negative impact on the real estate and land market in it, on the contrary, the date of the next elections and beyond, Turkey will focus, especially after the expiry of the Lausanne Agreement, on improving its economy and improving its investment opportunities, and whoever wins the election results will It is based on improving the standard of living and economic in the country, and not only that, but the chances of entering hard currency into the country will contribute greatly to the stability of the Turkish lira against the dollar, and from it results in the stability of commodity prices as well, and since foreign investments in the real estate market have been proven since October 2018 Especially after the enactment of the law granting Turkish nationality in exchange for real estate investment, it proved its importance in attracting investors to buy real estate in Turkey, and opening the way for many of them to open many fields of work through industrial or commercial investments or opening international companies, including providing many job opportunities with which Turkey faced a problem Global prices and inflation are significantly different from other developed countries, and Turkey is one of these countries. And since the focus of our conversation is about the field of real estate and land investments in Turkey, this question has been asked in the Turkish real estate market since the beginning of the enactment of the law granting Turkish citizenship in return for real estate investment, which is: Are real estate and land prices in Turkey exaggerated and is it a bubble? Although some investors in Turkey have made profits of up to 400% on the basis of the dollar during the past five years, investments in real estate and land are still going on, especially in areas that receive high attention from the Turkish government and their prices are rising day by day.

At the end of the article, I would like to point out that in light of what Turkey will go through from the results of the upcoming elections in May of this year, real estate investment in general and long-term investment in particular remains the best solution, and may even be the safest and most profitable for businessmen and the public in the current circumstances, especially with what The world is going through the problems of economic inflation, especially if the country of investment is Turkey, which carries all the ingredients for success in this field, as well as it is also on the verge of the end of the Lausanne Agreement in mid-May, which will produce an economic and investment revolution, increase revenues and solve energy problems in the future … We hope MBANY Real Estate In conveying the idea of the impact of the upcoming Turkish elections on the real estate market, and never hesitate to contact us through our website to serve you with everything related to investment opportunities and real estate offers in Turkey.

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