Mushroom

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Foreign currency buying is being talked about any over a million dollars must be looked at the government wants to know who why and what.
It hasn't happened yet, but I can see a time coming where it will be fine to move funds into the country but there are going to be more rules added to restrict funds getting out.
 

Rua

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Turkey's housing crisis: Prices in Istanbul go head-to-head with Miami​

Soaring real estate prices in Turkey continue to draw ire, with a report comparing the prices of luxurious apartments in Istanbul's Bağcılar district with houses in Miami.​

Turkish citizens are outraged at soaring real estate prices in the country, pointing out that the situation has come to a point where it is now possible to buy a house in Miami for the price of a luxurious apartment flat in Istanbul's Bağcılar district.

Turkey's dictionary-based discussion forum Ekşi Sözlük has compared the housing prices in Bağcılar with those in Miami under a report titled “Selling an apartment flat in Bağcılar and buying a house in Miami with the money coming from there: Now it is possible.”

The report gave an example of an online advertisement on Sahibinden.com in which a real estate agent is seeking a buyer for an apartment flat in Bağcılar for 6.5 million liras, i.e. approximately $430,000.

The same report also shared the prices of houses put on sale on the U.S. real estate search engine Zillow. Accordingly, there are houses that sell for from $299,000 to $370,000 in Miami.

Property prices have increased by 106 percent in Istanbul in the past year. Builders cite rising input costs, the lira's depreciation as well as thin supply in the housing market as reasons for the surging prices.

The construction index has soared 102% year-on-year in March, according to data from the Turkish Statistical Institute (TÜİK).

To address the housing crisis, President Recep Tayyip Erdoğan on May 9 announced three separate loan packages. The new package offers first-time buyers much cheaper credit. However, experts have warned that cheap mortgages will further deteriorate inflation and will not provide a solution for surging house prices.
Scary.
As an aside I once had to go the SGK office which was in Bagcilar.I wouldn't have thought there were luxurious buildings there
 

Kanga

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From today's FT.

Turkish authorities have raised the pressure on the country’s banks to limit corporate clients’ purchases of foreign currency in an effort to halt a renewed slide of the lira.
Bankers in Istanbul, Turkey’s financial centre, say that they are facing increased interference from the central bank, with officials probing corporate FX transactions worth as little as $1mn. “Even for $1mn or $2mn, they are calling to check: who is the buyer?” said one senior Turkish banker. “They’re really anxious about the corporate flow.”
The interference is the latest unconventional tactic Turkish officials have deployed to steady a currency that has fallen by 45 per cent against the dollar over the past 12 months, sending inflation soaring
With the financial sector under strong political pressure from president Recep Tayyip Erdoğan, bankers say they have little choice but to comply with the demands to seek advance approval from the central bank for big-ticket foreign currency purchases. In some cases, commercial banks have been ordered to refuse to facilitate FX purchases for their clients altogether, especially those worth more than $5mn.
While Turkish authorities have repeatedly interfered in the running of banks and corporates in recent years, another banker said that the meddling “has been intensifying” and they were “coming under closer scrutiny”.
A person with close links to the Turkish banking sector said the situation has created anxiety in the business community. “This is leading to worries among corporates that they might not be able to buy as much FX as they need.”
Businesses need dollars and euros for an array of reasons, from paying for raw materials bought from abroad to serving their large foreign currency debt burden. Turkish authorities, however, have raised concerns that some firms are engaging in speculation against the lira.
After four months of relative stability, the currency has lost close to 4 per cent against the dollar since the middle of last week. Foreign currency sales by the central bank and unorthodox policy measures aimed at encouraging savers to park their cash in lira accounts had acted as a sticking plaster during the opening months of 2022.
On Monday, the lira fell through the symbolic threshold of TL15 to the dollar, denting public confidence in a currency seen as a barometer of the health of the broader economy.
The latest wave of pressure on Turkish companies and banks to limit their foreign exchange transactions comes at a time when liquidity in the country’s currency markets is limited, meaning that relatively small purchases of dollars or euros can have an outsized impact.
One of the bankers said officials were “respectful” in their requests and added: “The guys at the central bank know this cannot be a permanent solution.”
The central bank declined to comment.
Erdoğan, a life-long opponent of high interest rates, has used a string of unconventional methods to try to stabilise the lira while maintaining ultra-low real borrowing costs as he gears up for presidential and parliamentary elections that must be held before June 2023.
With the country’s benchmark lending rate at 14 per cent, the real interest rate stands at minus 56 per cent once annual inflation of 70 per cent is taken into account, creating a strong disincentive for holding lira assets.A widening trade imbalance, fuelled by soaring global energy costs, is another source of weakness and has exacerbated demand for foreign currency.
The central bank — long seen as having insufficient foreign exchange reserves — spent around $24bn on defending the lira in the first three months of 2022, according to Haluk Burumcekci, an Istanbul-based analyst.
A government savings scheme, unveiled in December, has attracted $55bn by promising to protect individual savers and corporates from foreign currency risk if they switch their money to lira. In January, exporters were told that they must sell 25 per cent of their foreign currency revenues to the central bank — a ratio that was lifted to 40 per cent in April.
 

B&B

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Re Miami. So my crappy little building site in Yenikoy outside Kusadasi went from €23k to €50k in April. Village has only a tuck van and a bus stop. Some small apartments with families crammed in. But it's twee in a Turkish way. Meanwhile hunting in Granada area. Sites were €40k but 3 times as big. I found a small one for my retirement 100m2 house. €10k. I'm in shock.
 
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Chasey

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The pound is at historic lows but still moving up against the Lira?? 18.8+ now? Not great for Turkey.
 

Rua

Member
Watch The Lira Now
Re Miami. So my crappy little building site in Yenikoy outside Kusadasi went from €23k to €50k in April. Village has only a tuck van and a bus stop. Some small apartments with families crammed in. But it's twee in a Turkish way. Meanwhile hunting in Granada area. Sites were €40k but 3 times as big. I found a small one for my retirement 100m2 house. €10k. I'm in shock.
Much better value although my friends found it tough to buy a holiday apt in Spain with opening bank accounts and appointments.
Will be interesting to see if Turkey price themselves out of the holiday market this year.Spain is much easier for Europeans to travel to as there is more competition on flights and flight times are shorter.
 

Rua

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Just comparing the bubble of Ireland with the bubble of Turkey.You can buy a bit of rock history for less than a million in West Cork whereas many houses in coastal regions in Turkey are going for well over a million.Madness.
 

Kanga

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Another house purchase support scheme for Turkish buyers.
 

enoch

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Just been looking at future values for the dollar lira most are saying 17 to 18 by the end of the year the Turkish economist could be right with his prediction he made earlier in the year. Got help the poor. Akp and MHP have just voted down rent price control. They say milk has hit 21tl in some areas. My friend has just walked away from his rented hotel and took a restaurant job in Denmark sick of the stress?
 

B&B

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My regular commentator source on Turkey is still predicting a hard 3-6 mths ahead. No new figures of note however he did mention the monthly inflation rate is set to compound. So the last one was 7.25%. Extrapolating that forward over 12 months we get an annual rate of 131.6%. Nobody can last that level of pain.
 

Rua

Member
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I agree with you B&B it will be a very hard six months.Things are getting very expensive in Turkey.Petrol rising daily.Flights from Izmir to Istanbul are nearly the same as Izmir to Germany.Corendon airways have some good offers on at the moment so I think it might be cheaper for us to holiday in Germany rather than Turkey.
 

cigliboy

Member
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I agree with you B&B it will be a very hard six months.Things are getting very expensive in Turkey.Petrol rising daily.Flights from Izmir to Istanbul are nearly the same as Izmir to Germany.Corendon airways have some good offers on at the moment so I think it might be cheaper for us to holiday in Germany rather than Turkey.
We are finding good prices to Germany then cheap flights to the UK as an alternative to via Istanbul.
 

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