The housing market in Turkey is still in its early years of development compared to the rest of Europe, which in part explains a lot of the comparisons with the Spanish market of about 20 years ago. June 2003 saw the opening of the Turkish property market to foreign buyers and since then there has been a huge surge of investment as the country makes itself more susceptible to foreign direct investment.

As of June 2004, a year after the rules were relaxed, more than 40,000 properties across Turkey were owned by about 5,000 investors from 64 different countries. Citizens from 87 countries with reciprocal property purchasing agreements can now buy in Turkey, while residents of a further 24 countries are able to purchase buildings but not land.

Unsurprisingly, this has ignited a whole new market in Turkey, given prices for a 2 bed apartment were as low as $14,000 in 2000. Despite the historic animosity between the two, a third of all foreign owners in 2004 were Greek. Less surprisingly, the rest of the market consists primarily of German, British, French and Dutch, while there is also a notable Syrian and American presence.

Indeed, it is British buyers who have been the most active during recent times in Turkey. As can be seen in the table to the right, the number of British owners in July 2003 was 2,964, a modest 7.9% share of the foreign market. By the beginning of 2005, that figure had increased by 214% - six times higher than the overall foreign market - with just under 10,000 British owners, almost a fifth of the Turkish foreign market. Over the same period of time, the number of properties in British ownership has risen from just under 2,500 to 7,084, more than doubling British stock to 14.7% of the total foreign stock in the country.
No official figures are actually available to show the true rate of house price growth in Turkey, although a General Directorate of Land Registry has been established, to monitor sales of all

properties. The figures being quoted for Turkey come from the agents selling the properties, so the only true indication of house price growth in the country would be a detailed analysis of prices for similar properties over a period of time

Like many of the new emerging former Eastern Bloc countries that are becoming the focus of British residential investors, growth is being estimated at anywhere from 10% to even 40% per annum in some cases. However, given the current static state of the UK housing market and the current slowdown in growth across the more established markets such as Hong Kong, Australia and the USA, even a more conservative estimate of 10% still looks attractive, especially when it is still so affordable compared to some of the alternatives.

This lack of official house price growth information leads to a further problem with investors looking to buy in Turkey. Every year, a Global Real Estate Transparency Index is produced by firm Jones Lang LaSalle, comparing availability of accurate property market information, the legal process, owners' rights, building codes and so on, covering 50 countries worldwide. The UK stands in fourth place, one of the most transparent markets on the globe. Turkey on the other hand has a market that is referred to as 'opaque', with poor supply and demand data, weak title and corrupt practices. On the plus side, as the country nears EU accession, these problems will be addressed, although this could take some time.