How has the reduction of the minimum real estate investment for citizenship impacted your sales?
Following the reduction of the minimum real estate investment for citizenship to USD250,000, there was a 40% increase in sales to foreigners. Reducing the requirement was a correction to the standard in the global market, as most countries giving residency permits use similar values. Compared to the local market, foreign sales account for about 10% of sales. It is not a big market for Turkey, though the change in regulation has helped.
How do you seek to grow the number of sales to foreigners within Turkey?
We are a real estate network with around 50 offices. In Turkey, we started selling real estate to European markets in tourist areas and began selling in Istanbul four or five years later. We have almost 10 years of experience in the European market and have an operation in the US as well. We see significant growth from the Iranian, Iraqi, Afghani, and Pakistani markets. We do local business through our branches and system and the international business in our headquarters as a separate team. We have a network of sub agents, similar to a franchise system, and have organic balance in many countries.
Considering the depreciation of the lira, how have your customers been impacted?
The depreciation of the lira and the reduced real estate investment for citizenship combined have increased foreign sales by 40%; however, there is still room to grow. Domestically, the impact comes down to financing. As a developing country, customers do not live on cash and need mortgages. If the rates are high, they have to wait. TRY400,000 is a psychological limit for people to purchase; no one can take out all the cash to purchase when the interest rates are so high. However, this has happened before and will happen again. The real estate market is cyclical. The demographics of the market will result in future growth. Turkey has a young population that demands real estate. There are 21 million housing units in Turkey, and 14 million of them were not built up to code according to the earthquake law. There is a great deal of room to grow, and foreigner movement is just a small piece of the journey.
What elements of technology have you incorporated into your business?
We have a conventional agency system and are also extremely strong in digital. We are doing most of our operations digitally now and have a software company with sales office CRMs, applications for real estate dealers, and online payment systems for property management stuff. We are also doing software products for marketing.