General Overview of Turkey’s Real Estate Sector 2025

General Overview of Turkey’s Real Estate Sector 2025

Turkey’s real estate sector, despite facing fluctuations in recent years, continues to maintain its position as one of the key drivers of the national economy. Data from the Turkish Statistical Institute (TÜİK) and the Central Bank of the Republic of Turkey (CBRT) indicate strong recovery signals in 2025, supported by increasing housing sales, employment growth, and new project launches.

Main Indicators

- Housing Sales: In the first nine months of 2025, a total of 1,128,727 housing units were sold — a 19.2% increase compared to the previous year. The first quarter saw 335,000 sales (+20.1%), the second quarter 356,000 (+34.1%). The monthly average of 115,000 sales demonstrates the market’s stability.

- Employment: The construction sector reached a record 2.01 million employees in August 2025 (+7.2%), driven by urban transformation, earthquake housing, and public projects.

- Price Index: The CBRT House Price Index (HPI) rose 1.7% monthly in September 2025, reaching 195.7. However, real annual change stood at -3.7% (nominal +26.8%). The average housing price was ₺3.26 million.

- Foreign Investment: In 2024, 23,781 units were sold to foreigners (a 2.1% decline), with Istanbul and Antalya leading.

- Trends: Sustainability (green buildings), digitalization (virtual tours, AI consultancy), hybrid offices, and data centers are emerging as key trends. Industrial real estate (logistics, e-commerce warehouses) is growing, while shopping mall supply is expected to reach 13.9 million m² by the end of 2025.

Despite inflationary pressures and high interest rates, the sector remains supported by a 9.2% real growth rate expected for 2025.

10- and 20-Year Overview

Over the past two decades, Turkey’s real estate sector has expanded significantly due to urbanization (+50%), population growth, and urban renewal projects. However, inflation, interest rate fluctuations, and earthquakes have occasionally slowed momentum.

Last 10 Years (2015–2025) Housing Sales (Approximate Annual Units)

Year Total Sales Change (%) Notes

2015 1,102,000 +9.5 Urbanization momentum 2016 1,205,000 +9.3 Rise in foreign demand 2017 1,409,000 +16.9 Peak period 2018 1,175,000 -16.6 Currency crisis impact 2019 1,349,000 +14.8 Recovery 2020 1,368,000 +1.4 Pandemic slowdown 2021 1,443,000 +5.5 Demand surge 2022 1,486,000 +3.0 Inflationary pressure 2023 1,174,000 -21.0 Earthquake & interest effects 2024 1,478,000 +25.9 Record rebound 2025 (Est.) 1,600,000+ +8–10 +21.3% in first 8 months

Trend Summary: Rapid growth (2015–2017, CAGR +10%), slowdown (2018–2023, CAGR –2.5%), recovery (2024–2025). Real prices have declined for 20 consecutive months since Feb 2024 (–14.9% peak drop in May 2024).

20-Year Overview (2005–2025)

Growth: Real estate contributed 10–12% to GDP, with 59 consecutive quarters of growth since 2005. Despite 8.5 million vacant homes, continued urbanization sustained demand. Foreign investment peaked in 2017 at $10.8 billion.

Milestones:

2008: Global crisis slowdown

**2013: **Sales peak (1.157 million units)

2023: Earthquake (-14.9% drop) Demand for real returns has driven the market, though mortgage loans fell from 18.9% (2022) to 10.7% (2024).

Overall CAGR: ~5–7%, with sustainability and digital transformation accelerating in the last decade.

Size, Market Share, and Turnover of Branded Housing in Turkey

Branded housing — projects developed by recognized companies offering standardized quality — represents the premium segment of the market.

- Market Size: In 2024, 484,461 new home sales (32.8% of total); branded share estimated at 20–25% (~100–120k units). In 2025 (first 8 months), 174,055 first-hand sales, branded share ~25% (~43–44k).

- Market Share: Branded housing accounts for 20–25% of total sales; Istanbul holds over 40%. In April 2025, first-hand sales share was 29.3% (34,633 units), branded share ~25%.

- Turnover: With an average price of ₺3.26 million, total branded turnover in 2024 was ₺300–400 billion, projected to reach ₺400–500 billion in 2025. The total sector turnover is approximately ₺2–3 trillion (housing accounts for 60%+). Branded projects are expanding with sustainable and tech-focused mixed-use developments, expected to grow 10%+ in 2025.

Impact of Recent Slowdown and Real Price Decline on 2026

Between 2024–2025, both residential and commercial segments experienced a slowdown, and real prices continued to decline (HPI –15% in 2024; –3.7% in Sept 2025).

Reasons: High interest rates (mortgage share fell from 18.9% to 10.7%), inflation (+50%), earthquake effects, and rising supply from government projects.

2026 Outlook:

- Optimistic Scenario: With potential interest rate cuts (from 20% to ~15%), currency stability, and new housing loan campaigns, sales may increase 10–15% (1.8M+ units). Urban transformation will act as a catalyst, and real prices may stabilize (+0–2%).

- Risks: Persistent inflation and geopolitical uncertainty could delay recovery. However, industrial and commercial real estate (data centers, malls) may support 5–7% growth.

- General Outlook: 2026 is expected to be a dynamic year with balanced prices and renewed investor interest — a potential opportunity window for buyers and developers alike.