Property in Turkey: results of the first eight months of 2013

In the first eight months of 2013 the Turkish real estate in major tourist and business centers has increased in price by an average of 6.5%. Rental rates have increased by about 3%.

End of summer season is the best time to take stock of the intermediate results of the development of resort real estate markets. Counseling Center of Real Estate in Turkey pleased investors with a detailed account of the dynamics of prices and rental rates in the markets of the main tourist and business centers of the country for the period from January to August 2013. Rated was the state of the markets  , Istanbul, Ankara , as well as changes in prices of apartments in the new buildings, housing of various sizes and some other indicators, reports ee24.com citing antalyatoday.ru.

Dynamics of prices for residential real estate in Antalya, Istanbul, Ankara and Izmir

	Antalya	Istanbul	Ankara	Izmir
January, 2013	0.81%	0.95%	0.28%	0.30%
February, 2013	0.30%	0.18%	0.09%	0%
March, 2013	0.90%	0.94%	0.76%	0.44%
April, 2013	0.10%	0.87%	0.28%	0.74%
May, 2013	1.19%	0.87%	0.47%	1.09%
June, 2013	1.08%	1.66%	1.12%	1.01%
July, 2013	0.10%	2.14%	1.29%	1.22%
August, 2013	0.68%	1.79%	1.00%	1.48%
A total of 8 months	5.16%	9.4%	5.29%	6.28%

In the period from January to August 2013, housing prices in Antalya, Istanbul, Ankara and Izmir showed growth. The fastest rising prices was in Istanbul, an increase in 8 months by 9.4%. The coolest month was February, when in Antalya, Ankara, Izmir and Istanbul, prices rose by an average of 0.14%, and the biggest jump in prices (an increase of 2.14%) was observed in Istanbul in July.

Earlier that Turkey, along with Estonia is in the lead in terms of growth in real estate prices in the second quarter of 2013.

Changes in the value of apartments in new buildings in Turkey

	1+1 room	2+1	3+1	4+1
January, 2013	0.16%	0.31%	0.64%	1.06%
February, 2013	-0.16%	0.08%	0.24%	1.38%
March, 2013	0.08%	0.99%	1.11%	1.52%
April, 2013	0.68%	1.42%	0.60%	0.08%
May, 2013	1.87%	1.42%	-0.15%	0.47%
June, 2013	2.14%	2.04%	2.04%	1.34%
July, 2013	1.67%	2.15%	2.15%	1.56%
August, 2013	2.95%	2.79%	3.01%	0.31%
A total of 8 months	9.39%	10.71%	9.64%	6.78%

Prices for apartments in the primary market generally showed steady growth. Most rapidly increased the cost of apartments of 2+1 type - 10.71% in 8 months. A little less speed showed the apartment prices of 1+1 and 3+1 (9.39% and 9.64%, respectively). The slowest growth showed apartments of 4+1 type, showing the cumulative growth of only 6.78%.

Such a positive trend confirms the statement by the Minister of Environment and Urban Planning Erdogan Bayraktar that the country's budget will be supplemented by €3.7 billion from the sale of real estate to foreign investors.

The dynamics of the cost of the primary real estate depending on the area

	51-75 sq.m	76-100 sq.m	101-125 sq.m	126-150 sq.m	More than 151 sq.m
January, 2013	0.16%	0.65%	0.47%	0.80%	0.98%
February, 2013	0.16%	0.08%	0.23%	0.32%	0.89%
March, 2013	0.47%	0.57%	0.62%	0.71%	1.20%
April, 2013	0.55%	1.05%	0.23%	0.24%	0.08%
May, 2013	1.96%	1.99%	0.84%	-0.63%	-0.16%
June, 2013	2.15%	1.95%	2.13%	2.14%	1.83%
July, 2013	1.50%	1.99%	1.56%	2.25%	1.71%
August, 2013	2.22%	2.48%	2.71%	3.03%	1.15%
A total of 8 months	8.85%	10.76%	8.79%	8.86%	7.68%

New housing area of ​​51-125 m demonstrated steady growth throughout the past 8 months. Most of all rose the prices for real estate area of ​​76-100 m (by 10.76%). The most insignificant growth was showed by large objects with area over 151 square meters.

The dynamics of housing prices in Turkey in the first eight months of 2013

	Compared to the previous month	Compared with the same month in 2012
January, 2013	0.55%	9.53%
February, 2013	0.23%	8.84%
March, 2013	1.02%	8.56%
April, 2013	0.31%	7.99%
May, 2013	0.54%	7.95%
June, 2013	1.84%	9.03%
July, 2013	1.88%	9.91%
August, 2013	2.66%	12.47%

The highest rates of growth in the value of property occurred in the summer months (1.84%, 1.88% and 2.66%). Compared to the last year the cost of housing in Turkey has grown by an average of 9.3%. By the way, the prices in the east of the country are growing faster than in the western regions, as previously wrote ee24.com.

Dynamics of prices for new housing in Istanbul

	The European side	The Asian Side
January, 2013	0.97%	0.21%
February, 2013	0.22%	0.14%
March, 2013	0.22%	1%
April, 2013	0.37%	0.28%
May, 2013	0.95%	0.21%
June, 2013	1.82%	0.49%
July, 2013	1.21%	1.05%
August, 2013	1.48%	2%

The rate of increase in the cost of new housing in the European part of Istanbul were higher than in the Asian part. If the primary property on the European side has increased in price by an average of 0.9% over the past eight months, the Asian part of the content showed only 0.67% growth. Earlier ee24.com noted the rapid increase in the cost of property in Antalya and Istanbul.

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Changing the amount of rent in Antalya, Istanbul, Ankara and Izmir

	Antalya	Istanbul	Ankara	Izmir
January, 2013	1.00%	0.23%	-0.79%	-0.16%
February, 2013	-0.79%	-0.93%	-0.60%	-0.32%
March, 2013	-0.40%	0.12%	0.20%	0%
April, 2013	-0.20%	0.47%	0.20%	0%
May, 2013	0.20%	0.35%	0.20%	0.16%
June, 2013	0.40%	1.39%	1.39%	1.28%
July, 2013	0%	1.72%	1.18%	1.42%
August, 2013	1.39%	1.35%	0.58%	1.24%
A total of 8 months	1.6%	4.7%	2.36%	3.62%

The cost of renting in the regions of Turkey was moving in different directions. In Antalya, from February to April 2013 there was a decline in prices, which was replaced, though, by a slight increase in the summer months, but led to a cumulative increase in rental cost by only 1.6 % in 8 months, which is the worst result among the four major cities of Turkey.

In Ankara, rental rates have been less volatile, showing an increase of 2.36% in eight months. In Izmir rates remained unchanged in March and April, but the growth in summer allowed to fix an overall increase in rental rates by 3.62%.

The most radical changes were in Istanbul. In February, it was noted a record rate reduction (-0.93%), and in July as record growth (1.72%). Not surprisingly, the city was the leader to increase the cost of rent, which rose by 4.7% in 8 months.

As was reported earlier by ee24.com, the market of rental housing in the resort Antalya region may overheat in the near future due to the increased attractiveness of the Turkish property to foreign investors, as Turkish economy copes with the crisis much better than other countries.

Finland: the economy weakens, but the prices are rising

The real estate market is stabilizing in Finland, despite the weakening economy. The price index for all types of housing has increased by 1.94% per year (0.29% inflation adjusted) for the first quarter of 2013, according to ee24.com.

According to the statistical agency of Finland, in May 2013 the average price of aresale property increased by 1.4% compared with the same period last year, amounting to €2,204 per sq.m. In Greater Helsinki the average cost of second homes has increased by 2.4% to €3,505 per sq.m. And in the rest of the country, the price tag on the "secondary housing" rose by 0.6% to €1,693 per sq.m.

Apartment buildings in Finland grew by 2.5% to €2,338 per sq.m., while in Greater Helsinki prices went up by 3.8% to €3,674 per sq.m. Single-storey house fell on average by 0.4% to €1,994 per sq.m.

Dynamics of prices on the secondary market adjusted for inflation
	Finland	Helsinki	Other regions
1983 – 1989	64.0%	68.5%
1989 – 1993	-49.2%	-53.4%	-44.4%
1993 – 1994	6.6%	10.3%	3.2%
1994 -1995	-4.8%	-6.3%	-1.9%
1995 – 1999	45.0%	62.8%	38.0%
1999 – 2001	-6.9%	-5.5%	-12.0%
2001 - Q2 2008	42.0%	45.7%	33.4%
Q2 2008 – Q1 2009	-6.4%	-8.6%	-4.0%

Finnish real estate market experienced a shock when in 2008 the interest rate rose to 5.53%, against the background of rising inflation and rising prices for food imports. In the first half of 2009, mortgage loans issued €1.8 billion per month compared to €2.6 billion per month for the same period in 2008.

The reasons for the weakening of the Finnish economy

The Finnish economy was strongly affected by the global crisis. According to the portal Global Property Guide in 2009, the recession was 8.5%. The budget was a large hole, in part because of a shortfall of taxes. In 2011, the Finnish economy has improved its position, showing an increase of 3.3%.

However, even though having a reasonable fiscal policy eurozone has not yet overcome the debt crisis, and Finland pulls into a new recession. The Finnish economy contracted by 0.2% in 2012, according to the Bank of Finland. In the first quarter of 2013, GDP declined by 0.1% compared to the 4th quarter of 2012 and by 2.1% compared to Q1 2012. The main reasons were the decline in exports of paper machines and vehicles associated with the overall decline in European demand. Experts suggest further economic contraction of 0.4% in 2013.

The unemployment rate in Finland increased by a maximum of four years, the level of 10.8% in April 2013 compared to 8.8% in April 2012 and 9.5% in April 2011. Inflation in 2013 will be around 1.7%.

In 2012, the budget deficit was 1.9% of GDP compared to 0.5% in 2011 and 2.5% in 2010. In 2013, the deficit will be 1.5% of GDP, according to the Finnish government. Sovereign debt in Finland in 2012 was 53% of GDP, compared to 48.6% of GDP in 2011 and 48.4% of GDP in 2010.

Despite the weakening economy, Finland is the only country in the euro zone, which still retains a AAA rating from all three leading international rating agencies. Thus, the Finns at the moment have the highest rating of financial liabilities in Europe.