Sales of goods abroad considered as exports of services: Official Gazette

ISTANBUL

The Turkish government will provide substantial financial support to real estate companies for their promotion activities abroad, according to a presidential decree published in the Official Gazette on April 22.

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The marketing of Turkish properties has been classified as “service exports”, the decree says.

In this context, all real estate companies and other establishments that market houses, offices and other properties have been entitled to obtain support from the public authorities.

For overseas trademark and intellectual property rights applications, real estate companies will receive financial support of up to 600,000 Turkish liras ($40,680) per year.

The upper limit of financial support for market entry applications and advertising campaigns will be 1.8 million lira ($122,000). Companies participating in fairs and exhibitions abroad will receive up to 300,000 lire ($20,340).

Foreign sales in the first three months rose 45.1 percent year-on-year to 14,344 units.

In 2021, home sales to foreign nationals increased by nearly 44% from the previous year to a record high of 58,576 units, which is around 4% of all home sales in Turkey.

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Istanbul was the preferred market for foreign buyers. They bought 26,469 homes in the country’s biggest city last year.

Antalya came second with 12,384 units sold to foreign nationals, followed by the capital Ankara with 3,672.

Iranians bought more than 10,000 properties in Turkey last year, topping the list of foreign buyers, while Iraqis bought nearly 8,700 homes. The Russians claimed the third sport by purchasing some 5,379 homes.
Turkey generates about $7 billion a year from home sales to foreigners since 2017.

Currently, foreigners must purchase real estate worth at least $250,000 to qualify for the program. According to the plans under consideration, the minimum level of investment will be raised to $400,000, or the equivalent in foreign currency.

Applicants for citizenship must keep the real estate purchased for a minimum of three years, and they must make this commitment in the title deeds of the properties they buy.

With the new regulations, the Turkish luxury real estate market will be reborn, said Baki Budakoğlu, director of appraisal firm Denge Değerleme.

He also said Istanbul’s real estate market was the 45th cheapest among the 50 most expensive connected cities in the world, according to a study conducted last year.

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“After the start of the Russian-Ukrainian war and the imposition of sanctions against Russia, we know that Russian investors went to Turkey to obtain citizenship. And it is a well-known fact that the average purchasing power of Russian investors is higher than that of Middle Eastern investors,” Budakoğlu said.

Although the number of home sales to foreigners may decline in the short term, the total amount of income from properties purchased by foreign buyers is expected to increase, he added.

Under the services export support program defined in the decree, companies operating in other sectors such as health tourism, cinema, education, entertainment, creative industries, sports tourism, l organization of fairs and logistics.

Economy, real estate sales,

Sharon P. Juarez