Last updated on May 17th, 2023 at 11:05 AM
The Coronavirus struck when the world least expected it. The world was experiencing one of the most peaceful and economically booming eras as people continued with their various businesses, tourism flourished, and businesses excelled.
However, towards the last quarter of 2019, the virus was first spotted in China, and in the next few months, it spread to over 50% of the world, with high mortality rates.
There is no gain in saying that the virus affected a lot of things, and real estate was not exempt.
Here are the various ways that Covid-19 affected the Turkey real estate market.
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The Turkey Real Estate Market Pre-Covid-19 Pandemic
Various 2018 reports reveal that the Turkish GDP was at a 2.98% high. Although that percentage was about 4.52% lower than the figures in 2017, it was at an average level since projections always reveal one year high, followed by the next year’s low.
However, an economic trend that has sustained through most parts of the 21st century was halted by the coronavirus. Rather than have an increase in 2019, the Turkish market experienced a massive fall at 0.78%.
Covid 19 was first announced and officially diagnosed in Turkey on March 11, 2020, which is about four months after its first outbreak in China.
By April, the figures had gone up to 14000, and by May, it reduced to 3000. Upon widespread infection and high mortality rates, governments had to reduce physical contact among people as a measure of minimising exposure.
This led to the shutdown of business facilities, lockdown procedures, deployment of medical facilities, testing kits, and health demands overweighing the medical facilities. As a result, business slowed down, and economic activities were severely hampered.
The Turkey Real Estate During the Covid-19 Pandemic
Most crucially, due to the lockdowns, Turkey’s Tourism was truncated, and the real estate market took a significant hit. The tourists frolicking in the various parts of Turkey could no longer come, and the residents had to preserve their homes.
The most critical factor during the pandemic was fear of the unknown. The Turkish market had hoped that the virus would be over in a few months, but as it seemed, it lasted up to a year, to say the least.
As supply outweighed demand, coupled with a crippling economic reality, the value of real estate began to sink. So much so that experts projected it may fall up to 20% by the end of 2020.
Some of the unexpected trends during the virus are that prices and rents increased in the suburbs, and smaller villages, while they fell in the central city areas. That is due to the migration from these major cities in search of localities with lesser exposure to the virus.
The Turkey Real Estate Market Post Covid-19 Pandemic
|Pre – Covid 19||Average sales: 108,362 units of housing|
|During the Corona Virus Pandemic||January: 61,555 units of housing|
|April: 42.783 units of housing|
|May: 50.936 units of housing|
|Post-Covid:||By December: 202.074 units of housing|
The Turkish government had to act fast to salvage the real estate sector in the country. As an SOS policy, the government formed alliances with the banking sector to create loan packages and customise mortgages to encourage the real estate sector and cushion the effect of the virus in the sector.
Also, credit conditions were relaxed, and mortgage terms were reduced to assist homeowners/holders. Also, these were followed with construction loans to aid the industrial subjects, including builders and companies.
These policies cumulatively stabilised the market and led to the subsequent rise being experienced such that two years later, the sector was alive and thriving.