Turkey Property Investment News

Turkey faces housing shortage as population grows

Despite the boom in investment and construction that Turkey has experienced in recent years, its growing population means that it will face a housing shortage over the coming years, according to figures from the Istanbul Chamber of Commerce (ITO).

The data shows that the country currently needs 300,000-350,000 new homes, and this number is expected to reach 5.5 million in eight years’ time. This is likely to spark interest among potential investors in Turkish property, as other investment destinations warn of over-supply in some areas cooling the property markets.

Of the current housing stock in Turkey, 55% is thought to be unlicensed and unregistered, 40% is in need of maintenance and 60% is over 20 years old. The demand for accommodation is largely driven by the country’s domestic population; with over 70 million people, 70% of those under the age of 30% and a growth rate of 2% a year this accounts for 2.88 million of the new homes needed by 2016.

In addition to these, 760,000 homes will be needed due to internal migration and 652,000 to deal with the need for renovation. The ongoing process of replacing the poor quality ‘shanty’ houses with properly licensed homes accounts for a further 1.25 million homes needed.

Many private property investors have invested in Turkey’s tourist areas - with tourist numbers at around 20 million a year, this is a growing industry that has had a significant effect on the country’s economy in recent years. However, it is Turkey’s growing population and its expanding cities that are changing the face of the country. The capital of Istanbul is home to 20% of the country’s population and by 2020 the city’s population is expected to reach 23 million, as the increasingly cosmopolitan city attracts workers from abroad as well as from within Turkey.