The property market was hit relatively hard by the global financial crisis. Although the lack of high-quality statistics makes the full effect of the recession difficult to judge, the Garanti mortgage index shows that, in the depths of the recession, property prices were down 15 per cent down across Turkey as a whole from June 2007. In addition, at the peak of the financial crisis, property sales by Turks and foreigners alike nosedived.
However, Turkey’s current economic success — coupled with strong population pressure, growing tourism and low interest rates — has brought about a rapid growth in housing loan volumes. The country is enjoying a “housing boom”, with house prices rising at a rate of over 6 per cent this year.
Indeed, the property market is growing on all sides: construction in Istanbul and other big cities is booming, Turkish commercial property is becoming some of the hottest in the world and residential investment is on the rise. The holiday home market is in good form, too: sales of property to foreigners in particular grew to 40 per cent of the market in 2010.