It is known that the Turkish lira value began to decrease since 2017, but since the beginning of 2020, the Turkish government has taken measures to limit the decline of its currency, but the Turkish lira has been in conflict with the US dollar, as it falls sometimes and rises at other times.
This confusion certainly affects the Turkish market, but to what extent is real estate in Turkey affected by this confusion in the Turkish lira.
For example, when the Turkish lira rises, the costs of building apartments and real estate will rise, which means an increase in their price, and the vice versa. When the Turkish lira decreases, construction costs also decrease, and therefore the price of the property decreases, but the real estate market effects by the rise or fall of the Turkish lira takes time. This particular time is the most appropriate to take the decision to invest or cancel it, bearing in mind that the lira may rise or fall again later.
Therefore, it is not necessary to rely on the exchange rate in determining the profit and loss of real estate investment. The profit and loss in this case depends on a later time after a sufficient period of time has passed until the stability of the Turkish lira.
Here we can say that the rise in the value of the Turkish lira against the US dollar does not necessarily mean that the price of real estate in Turkey will be affected, as construction companies are waiting until the lira stabilizes in order to raise the price or keep it the same.
In case of a decrease in the value of the Turkish lira, this leads to a rise in real estate prices because Turkey imports oil and many raw materials , which as a result affects the local real estate market, as the Turkish investor will have to postpone projects in this case, and the Turkish government is trying to control the exchange rate of its lira by raising interest, and thus real estate sales are declining at this time. But after the stability of the Turkish lira, things return to normal, and the demand for buying real estate retrun as stron as previously , and here the time must be used, as real estate prices have fallen a little.
Many investors are wondering if the value of their investments decreases with the decrease in the value of the Turkish lira. Yes that is true, but for a temporary period until the Turkish lira returns to stability. If the value of the Turkish lira decreases against the USD and stabilizes on this situation, then as a result, real estate prices will also rise.
