Author: Luxury Estate Turkey
Viewed 26 times
25 November 2025
The Turkish real estate market experienced pronounced volatility between 2021 and 2024. A sharp surge in property prices, driven by inflation and speculative demand, was followed by an expected cooling phase: mortgages became less accessible, and transaction volumes declined. By the end of 2025, however, conditions stabilised. Economic policy grew more predictable, inflation continued to ease, and domestic demand remained resilient. Signs of overheating gradually disappeared, and price movement began to reflect real rather than nominal dynamics.
These shifts are creating the conditions for a healthier investment cycle. For anyone planning to buy property in Turkey and analysing the outlook for the Turkish real estate market, 2026 is increasingly viewed as a potential turning point.
In 2021–2022, monetary policy combined with accelerating inflation led to an explosive increase in nominal property prices: the national house price index doubled in less than a year. As households lost purchasing power, investors and families rushed into real estate as a way to protect capital.
In 2023, monetary tightening reshaped the landscape. The benchmark interest rate rose from 8.5% to 42.5% annually, and nationwide property sales fell to 1.23 million units (–17.5% year-on-year), marking the lowest level in almost nine years.
By early 2025, financial markets entered a period of relative stability. Exchange-rate volatility declined, investor confidence began to recover, and conditions formed for a healthier, more predictable Turkey property market cycle.
Until recently, Turkey’s impressive property price increases were mostly nominal. Capital purchasing power did not increase as prices rose at the same pace as overall inflation.
In 2026, the situation may shift. The Central Bank’s tight monetary stance is already slowing inflation. Even moderate property price growth of 20–25% a year would translate into real capital gains. If forecasts prove accurate, 2026 could become the first year in a long period when property prices in Turkey outpace inflation, providing owners with genuine—not inflation-adjusted—returns.
Disinflation directly influences the Turkish real estate market through several property-specific mechanisms.
When inflation is in double digits, nominal price increases merely compensate for currency depreciation. This kept the real price dynamics of Turkish housing muted for nearly three years.
When inflation becomes predictable, long-term planning returns. Real estate is seen again as an asset for capital growth, not merely capital protection.
Once mortgage payments fall to a psychologically acceptable level (around 1.5% per month), families who postponed buying return to the market, sharply boosting demand.
In major Turkish cities, construction is constrained by land availability, municipal regulations and delivery timelines. Even moderate demand growth in a stabilising environment tends to lift prices.
With inflation at 5–10% and property price growth at 15–20%, an investor gains 5–10% real profit. In previous years, similar growth only offset inflation and did not increase capital.
Predictable macro conditions rebuild confidence. Lower inflation, a steadier currency and improved investor sentiment provide a foundation for sustainable, demand-driven appreciation in the Turkey’s real estate market.
In recent years, construction activity has consistently lagged behind real demand. The estimated annual demand is around 800,000 new homes, while completions have remained near 550,000. Economic fluctuations and rising building costs contributed to this imbalance.
Between 2016 and March 2024, construction costs increased more than 13.6-fold. This shift pushed many developers away from budget housing toward more expensive segments, where higher costs can be absorbed by the final sales price.
The February 2023 earthquake caused severe damage to the national housing stock: around 680,000 residential units were destroyed across 11 provinces. By the end of 2024, roughly 200,000 homes had been delivered, while the remaining volume remained under construction. A significant share of the country’s building capacity over the next several years will continue to focus on reconstruction.
This constraint is an important factor in any realistic Turkey’s real estate market forecast for 2026. In Istanbul, Ankara, Izmir and major coastal markets, the supply of new projects remains limited while demand stays strong.
Demand in the Turkey real estate market does not disappear—it accumulates. Several structural factors constantly sustain and regenerate demand.
Turkey remains a country with a young and growing population. Each year, hundreds of thousands of new households enter the market, creating baseline demand that construction activity cannot fully satisfy.
With urbanisation levels exceeding 75% and still rising, millions continue to migrate toward major cities—especially Istanbul, Ankara, Izmir and Antalya—creating pressure on the housing market.
Households from inland provinces move toward cities offering better infrastructure, education and employment, increasing demand for both rental and ownership options.
Tens of thousands of relocants arrived from Russia, Ukraine, Iran and various Middle Eastern countries. This influx strengthened rental demand and, in some cases, property purchases, especially in Istanbul, Antalya and Alanya.
Even when temporary factors slow the market, underlying demand continues to accumulate. As macroeconomic stability improves and inflation declines—expected by 2026—this postponed demand quickly translates into transactions. Combined with limited construction, these forces create a solid foundation supporting property prices in Turkey.
Starting in late 2024, the Central Bank began easing its stance. By autumn 2025, the benchmark rate had declined to 39.5%. If inflation continues to fall, mortgage rates may return to a functional range in 2026, restoring affordability for the mass domestic market—the primary engine of the Turkish property market.
Between 2021 and 2023, the market depended heavily on investors and foreign buyers—important but limited groups. The return of the mainstream domestic buyer fundamentally shifts dynamics.
Improved mortgage affordability leads to a rise in transactions, shorter listing periods, developers launching new projects based on real demand and steady, sustainable price appreciation. This marks the beginning of a new, more balanced growth cycle expected to define the real estate market in 2026.
After a record year in 2022, when foreign buyers accounted for nearly 5% of all property sales, transactions fell sharply. In 2023, sales to foreigners dropped to 35,005 units (2.9% of the market), with a similar trend in 2024.
Reasons included:
the citizenship-by-investment threshold rising from USD 250,000 to USD 400,000
the end of the exceptional 2022 demand from Russian and Ukrainian buyers
residency restrictions were introduced in several areas of Istanbul and Antalya
By mid-2025, a slight upward shift became visible: sales to foreigners rose to around 1.2% after hitting record lows. In 2026, this stabilisation is expected to continue, supported by steadier macro conditions, slowing inflation, predictable currency dynamics and strong tourism flow.
Turkey remains one of the most compelling real estate destinations for international buyers due to competitive pricing, favourable tax treatment (VAT exemption for foreigners on new builds), an accessible citizenship route, strong tourism infrastructure and a clear framework for foreign ownership.
Foreign buyers in Turkey tend to gravitate toward several well-established regions.
Istanbul
Istanbul remains the primary destination, functioning as the country’s business centre with extensive infrastructure and consistently high rental demand. The majority of international buyers in the city come from the Middle East, Asia and Europe.
Antalya and Alanya
Antalya and Alanya continue to attract those who prefer a coastal lifestyle with strong rental potential rather than the pace of a major metropolis. Alanya, in particular, serves as the largest hub for foreigners and is considered one of the most accessible resort markets in the entire Mediterranean region.
Bodrum
Bodrum occupies a distinctly premium position. The peninsula appeals to affluent European buyers as well as investors from the Gulf states, who value privacy, yachting infrastructure and the overall prestige of the location. Villas dominate the local market, reinforcing Bodrum’s identity as a luxury destination.
By 2026, geographic demand among foreign buyers is expected to become more balanced, yet the core preference is likely to remain unchanged. Those looking to buy property in Turkey will continue to prioritise the proven markets of Istanbul, the Antalya coast and Bodrum.
Following price growth of more than 100% in 2022–2023, the market shifted toward more moderate dynamics in 2024, when prices rose roughly 45–50%—essentially in line with inflation. In 2025, price growth is estimated at around 25%, and in 2026 at approximately 20%. Prices will continue rising, but without the overheating typical of inflation-driven cycles.
Real price growth is expected to return in 2026. With inflation projected at 10–15% and property price growth at around 20%, owners may see 5% real gains. This would mark the first restoration of real value since the stagnation period of 2021–2025.
Long-term projections suggest annual nominal appreciation of around 11% and real price growth of 3–5%. Istanbul and major coastal regions generally outperform the national average. Overall, real estate in Turkey is expected to remain a long-term appreciating asset through 2030.
For anyone planning to buy property in Turkey in 2025–2026, the current environment provides several advantages.
Turkish property prices in 2025 are still close to a real cyclical minimum. Nominal growth is expected to mirror inflation, meaning real prices remain low. Entering the market in 2025 allows buyers to secure a favourable base ahead of sustained real appreciation.
Competition remains modest, giving buyers stronger leverage—an advantage that may disappear by 2026 as demand increases. The selection of properties is also broader than in previous years. In 2026, the most desirable units may begin selling within weeks once demand accelerates. For short-term investors aiming to buy at the bottom and sell within 2–3 years, 2025 is the optimal entry point.
Government-backed mortgage programs for young families or first-time buyers may appear as inflation falls. Buyers who enter the market early may gain the dual benefit of incentives and a low price baseline.
Foreign buyers also gain from currency dynamics: forecasts indicate moderate lira weakening in 2025 followed by stabilisation in 2026, making 2025 particularly favourable for currency conversion.
In 2026, mortgage conditions are expected to improve, allowing many households that have been saving for the past several years to re-enter the market simultaneously. This will create a strong increase in transaction activity and return liquidity to the Turkey real estate market.
Nominal property price growth is forecast at 20–25%, while inflation is projected in the range of 15–18%. This implies real gains of 5–10%, marking a shift toward sustainable appreciation driven by genuine buyer demand rather than inflationary pressure.
Macro stability is expected to strengthen. Inflation is slowing, the Central Bank is positioned near a neutral stance, and the lira is projected to move within a narrower band. Growing household incomes will further support demand, making it more organic and less speculative.
New construction will begin to enter the market as permits issued in 2024–2025 convert into completed units. The increase in supply will not be large enough to create oversupply, allowing the market to maintain a healthy balance between demand and availability.
Buyers will remain more cautious and documentation-oriented after recent years of market turbulence. Thorough due diligence is expected to become standard practice, contributing to a more mature, stable market environment.
As liquidity improves, selling property becomes easier and more profitable—especially for buyers who entered the market during the downturn. This shift will open a new phase of stable, predictable growth for both buyers and sellers.
Luxury Estate Turkey guides investors through every stage of purchasing and managing property in Turkey, especially during a period of structural market changes. The agency combines in-depth market analytics, legal precision and high-level service to create a secure and predictable decision-making environment.
Turkey is moving toward a new phase of recovery and stable growth. In such periods, having a professional partner is essential. As a licensed agency, Luxury Estate Turkey manages the full process—from property search and due diligence to title deed transfer and asset management.
We work in person, online and remotely (Zoom, phone or at our office in Alanya), providing a comprehensive, premium experience. Our goal is to ensure your investment in the Turkey real estate market is secure, informed and profitable.
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