Intel & Data

Russians, Iranians, and Iraqis: The Top Citizenship by Investment Property Investors in Turkey

Cumhuriyet reports that in the twelve years since Turkey lifted restrictions on foreign real estate purchases in 2012, foreign buyers have acquired 384,519 homes in the country, according to data from the Turkish Statistical Institute (TurkStat).

While authorities don’t regularly publish comprehensive statistics on foreigners obtaining citizenship, the Environment Ministry recently disclosed that between 2018 and 2021, 19,630 foreigners obtained citizenship in exchange for purchasing a total of 30,358 properties. Cumhuriyet, however, claims as many as three in four of these foreigners who purchased real estate in Turkey “in recent years” did so as part of an application for the country’s popular citizenship-by-investment program (CIP).

The data reveal that Russians have been the top foreign buyers of Turkish properties since 2019, purchasing 39,172 units. Iranians follow closely with 35,573 homes, and Iraqis with 31,319.

Despite the CIP's popularity, Turkey’s real estate peak possibly in the rear-view mirror

The CIP, which initially allowed foreigners to acquire citizenship by investing a minimum of US$1 million in real estate before authorities lowered the bar to US$250,000 in 2017, has undergone several changes in recent years. In April 2022, the minimum investment amount rose to US$400,000. Unconfirmed rumors have indicated the threshold could rise again to $600,000 in 2024.

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These price hikes are part of authorities’ effort to manage the program's overwhelming demand and address issues such as property valuation fraud and abuse of promissory sales contracts.

The influx of foreign buyers, however, has contributed to a significant increase in property prices, leading some foreigners who have fulfilled the three-year holding period requirement for citizenship to sell their properties at substantial profits and leave Istanbul, said Nizameddin Aşa, president of the Istanbul Chamber of Real Estate Commissioners and Consultants, to Cumhuriyet.

Investors who bought homes for US$400,000 three years ago now sell it for as much as $1.5 million within only three years, Aşa further explains.

In other words, exiting the market has become more profitable than entering it, leading to a decline in growth. The data shows a 48.1% year-on-year decline in home sales to foreigners in 2023, with 35,005 units sold, the lowest point since 2017. Experts attribute this decrease to factors such as the substantial rise in prices in dollar terms, earthquake risks, and stricter requirements for obtaining citizenship.

Turkey will likely remain reliant on foreign buyers to buoy its real estate market; The data shows that out of the $254.2 total foreign direct investment in Turkey since 2002, a high 27% came from property sales to foreigners.

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Moustafa Daly AdministratorAuthorParticipant
Head of Digital , IMI

Moustafa Daly is the Head of Digital at IMI, based in Cairo.

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