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What will happen in Izmir’s real estate market? Will prices go up or down? Is Izmir still a hotspot for foreign investors? How is Turkey’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Izmir, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
1) Property values in Konak will steadily rise because of its central location and cultural attractions
Konak, right in the heart of Izmir, is set to see a steady rise in property values thanks to its prime location and cultural hotspots.
In 2023, property prices in Izmir jumped by 14.88%, and experts are predicting a further increase of 38.87% in 2024. This shows a growing interest in central areas like Konak, where everything is within reach.
Even though home sales across Turkey have dipped, Izmir's housing market is still going strong. In 2023, new home prices in the city shot up by 91.1% compared to the previous year. This boom is driven by Izmir's growing population and its charm as a tourist hotspot.
Konak is rich in cultural heritage, featuring the Historical Port City of İzmir, a UNESCO World Heritage Site. The government's efforts to preserve these sites make Konak even more appealing to both residents and investors.
Infrastructure is also getting a boost with projects like the Izmir Metro Phase 5, which enhances connectivity between Konak and other city areas. This makes living in Konak even more convenient.
With its mix of culture, improved infrastructure, and rising property values, Konak is becoming a top choice for those looking to invest in Izmir.
Sources: Turk.Estate, Izmir Tourism, AIIB Project, UNESCO World Heritage, Global Property Guide
2) Rents in tourist-friendly areas will increase as demand for short-term rentals grows
Izmir is becoming a hot spot for tourists, with over 2 million visitors in 2022 alone.
In 2023, the city saw a 46% jump in domestic tourists in just the first five months, and the local government is aiming for 4 million tourists by 2024. This surge is partly due to Izmir being featured in Lonely Planet's top travel destinations for 2024, which naturally attracts more visitors.
Many of these tourists are opting for short-term rentals instead of hotels, following a global trend for more unique and affordable stays. This shift is particularly noticeable in Izmir's tourist-friendly neighborhoods, where demand for short-term rentals is pushing up rents.
Rental yields in Izmir have been climbing, with rental rates increasing by over 55% from March 2023 to February 2024. Property owners are seeing higher demand and occupancy rates, which means more rental income for them.
As more tourists flock to Izmir, the demand for short-term rentals is expected to keep rising, making it a lucrative opportunity for property investors. This trend is especially strong in areas popular with tourists, where rental properties are in high demand.
For those considering buying property in Izmir, the city's growing popularity and rising rental yields make it an attractive option. With the local government's plans to boost tourism even further, the potential for rental income looks promising.
Sources: Turk Estate, Izmir Metropolitan Municipality, Barnes Turkey
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Turkey versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
3) Interest from Middle Eastern investors in Izmir’s real estate will grow as they seek stable opportunities
Izmir has been catching the eye of Middle Eastern investors, and there are several reasons for this growing interest. First, the city has seen a record number of tourists, including many from the Middle East, which highlights its appeal and potential for investment. In 2022, Izmir hosted over 2 million tourists, and this trend continued with a 15% increase in foreign tourists in early 2023.
Another key factor is the increasing number of direct flights between Izmir and major Middle Eastern cities. This improved connectivity makes it easier for investors to travel and explore opportunities in the region. Additionally, the real estate market in Izmir is thriving, offering a range of options from luxury villas to modern apartments, which are particularly attractive to foreign buyers.
The Turkish government has also made it easier for foreign investors by offering tax breaks and simplified property-buying processes. This, combined with favorable exchange rates for Middle Eastern currencies, makes investing in Izmir's real estate market even more appealing. Furthermore, media coverage has highlighted Izmir as a prime destination for real estate investment, emphasizing its cultural heritage and economic growth.
Sources: Property by Sahar, Izmir News, Direct Flights, Aegean Locations, Mira Magazine
4) Rental yields in student areas will rise as universities expand programs
The rental market in student-heavy areas is thriving as universities expand their programs.
Take Izmir, for example, where over 150,000 students are spread across 13 universities and colleges. As institutions like the Izmir University of Economics grow, the need for student housing naturally rises. This surge in demand is a golden opportunity for property investors.
Student housing has bounced back impressively since the pandemic, with strong occupancy rates and rent growth. By June 2024, about 84.5% of beds at core universities were already leased for the Fall semester. This high demand is partly due to limited dormitory space and soaring house rents, making quality student housing scarce.
Whenever universities expand, the demand for student accommodation follows, leading to higher rental yields. This pattern is clear in cities where university growth has pushed up housing demand in student-heavy areas. Experts predict nearly 10% rent growth for the 2024-2025 academic year, thanks to steady demand and high occupancy rates.
Investors should note that student-heavy areas offer lucrative opportunities as universities continue to expand. The consistent demand for on-campus housing is a key driver of this trend, making it a promising market for those looking to invest in real estate.
Sources: Edurank, Unises, CrowdStreet
5) Affordable housing projects will stabilize prices in Izmir's outskirts
Affordable housing projects in Izmir's outskirts are key to stabilizing property prices there.
With a growing demand for affordable homes, these projects are a smart way to balance supply and demand, which is crucial for keeping prices steady. The government is backing these efforts, focusing on middle and upper-middle-income groups. They're teaming up with private developers to offer affordable interest rates and payment plans, making it easier for people to buy homes.
There's plenty of land available in the outskirts, which is perfect for these developments. Looking at other Turkish cities, we see that similar projects have successfully stabilized prices. For instance, TOKİ's social housing program has shown that affordable housing can keep prices stable or even lower them over time.
Improved infrastructure and better transportation links to the city center make these suburban areas more appealing. This increased attractiveness boosts demand, which in turn helps stabilize prices. The outskirts of Izmir are becoming more connected, making them a viable option for potential buyers.
These projects are not just about building homes; they're about creating communities with easy access to the city. As more people move to these areas, the demand for local amenities and services grows, further supporting price stability. The combination of government support, private investment, and strategic location is a winning formula.
In short, affordable housing in Izmir's outskirts is a smart move for anyone looking to invest in property. It's a chance to get in on the ground floor of a growing area with a promising future.
Sources: Hürriyet Daily News, TOKİ Housing Programs
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6) Airbnb-style investments in Izmir will become less profitable due to stricter short-term rental regulations
Stricter regulations on short-term rentals in Izmir are likely to impact the profitability of Airbnb-style investments. In the past, cities like New York City have seen significant effects from similar regulations, such as reduced inventory and increased compliance costs, which made it difficult for operators to maintain profitability.
In 2023 and 2024, Izmir's short-term rental market was thriving, with an average occupancy rate of 34% and a monthly revenue of $4,706. However, the introduction of new regulations requiring a special license and compliance with strict guidelines could increase operational costs and reduce demand, affecting these figures.
Moreover, the Turkish government's enforcement actions, including physical inspections and fines for non-compliance, highlight the seriousness of these regulations. This could lead to a decrease in the number of available properties, further impacting profitability for property owners who rely heavily on short-term rental income.
Sources: Tekce, AirDNA, The Ege Eye
7) Demand for modern apartments in Izmir will grow as young professionals move in for job opportunities
Izmir is becoming a major tech hub, attracting young professionals seeking job opportunities.
In recent years, Izmir's tech and service sectors have seen significant growth, drawing both local and international talent. This boom is fueled by the Turkish government's "Digital Turkey" program, which has been shaping the country's tech landscape since 2023.
Multinational companies, like Adesso in Teknopark İzmir, are setting up shop, highlighting the strong demand for modern apartments. These companies bring in a workforce that prefers contemporary living spaces, further boosting demand.
Real estate market reports from 2023 and 2024 show a surge in demand for modern apartments, driven by the city's expanding tech industry and the availability of new residential complexes.
Izmir's urban transformation wave is creating fresh opportunities for tech professionals. This aligns with young professionals' preferences for modern living spaces that offer convenience and amenities.
The rising rental prices for modern apartments indicate a strong demand, supported by the influx of young professionals and the growing number of multinational companies establishing offices in the city.
Sources: Nucamp Blog, DevsData, Adesso Office İzmir
8) Izmir’s real estate prices will grow moderately as supply and demand remain balanced
In recent years, the real estate market in Izmir has shown signs of moderate price growth due to a balanced supply and demand. Despite a decline in the overall Turkish real estate market, Izmir's home sales remained relatively strong, with 58,299 units sold in the first eleven months of 2023. This indicates a resilient market compared to other major cities in Turkey.
The housing supply in Izmir has been stable, supported by a significant increase in new dwelling construction across Turkey. In the first three quarters of 2023, the number of dwelling units granted construction permits rose by 24.1%, contributing to a balanced housing supply in Izmir. This balance between supply and demand helps maintain moderate price growth.
Additionally, Izmir has seen consistent demand from both local and international buyers. Although foreign home purchases in Turkey dropped significantly in 2023, Izmir still attracted interest, indicating a steady demand that supports moderate price growth. Furthermore, government policies promoting sustainable urban development and infrastructure improvements enhance property values, making Izmir an attractive market for buyers.
Sources: Global Property Guide, IMI Daily, Land Network, Turkey Expert
We have made this infographic to give you a quick and clear snapshot of the property market in Turkey. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Luxury property prices in Izmir will rise as demand for high-end homes increases
The demand for high-end properties in Izmir is set to push luxury segment prices higher.
In 2023, Izmir's house prices surged, with new dwelling prices jumping by 91.1% year-over-year. This trend highlights a strong rise in property values, especially in the luxury market. The city is becoming a hotspot for high-net-worth individuals seeking undervalued luxury properties. Unlike other Turkish cities, Izmir has seen less foreign investment, making it a strategic choice for affluent buyers.
International investors from the Middle East, Europe, and Asia are increasingly eyeing Izmir, further boosting the value of its luxury properties. The city's appeal is growing, thanks to new luxury residential projects that are attracting more affluent buyers. These developments are often featured in media, portraying Izmir as a prime location for luxury property investments.
The Turkish government's Citizenship by Investment program is another factor driving demand. This initiative encourages luxury real estate development, making Izmir even more attractive to high-net-worth individuals. The combination of these elements is creating a perfect storm for rising luxury property prices in the city.
Izmir's unique position as a value play within Turkey is drawing attention from savvy investors. The city's blend of cultural richness and modern amenities makes it a desirable destination for those looking to invest in luxury real estate. As more people discover Izmir's potential, the demand for high-end properties is expected to continue its upward trajectory.
With its strategic location and growing reputation, Izmir is poised to become a key player in the luxury real estate market. The city's ongoing development and investment opportunities are likely to keep attracting high-net-worth individuals, further driving up property values in the luxury segment.
Sources: Global Property Guide, The Wandering Investor, Prime Property Turkey
10) Demand for affordable rentals will rise as the student population grows in the city
The city's growing student population is driving up the demand for affordable rental properties.
In Izmir, universities like the Izmir University of Economics are seeing a surge in enrollment, with over 9,322 students enrolled as of 2024. This isn't just a one-off; other institutions such as Ege University and Yasar University are also experiencing similar trends. With more students flocking to the city, the need for housing, especially affordable options, is on the rise.
Newer universities like Bakirçay University and Izmir Democracy University, both established in 2016, are adding to this influx. As these institutions grow, the areas around them become hotspots for student housing. Students often prefer living off-campus for the freedom and cost savings, which puts extra pressure on the rental market.
Real estate agents and media reports are buzzing about a shortage of student housing. Existing accommodations are often overcrowded, and this scarcity is pushing rental prices up, particularly in neighborhoods close to universities. Students are left scrambling for affordable options, which only fuels the demand further.
Neighborhoods near these educational hubs are feeling the squeeze. Rising rental prices are a common complaint, making it tough for students to find budget-friendly places to live. This situation is creating a competitive rental market where affordable properties are snapped up quickly.
For potential property buyers, this trend offers an opportunity. Investing in rental properties near universities could be a smart move, given the consistent demand from the student population. As more students continue to enroll, the need for affordable housing isn't going away anytime soon.
Sources: Edurank, Izmir Estate, Rentola
11) Demand for retirement-friendly housing in Izmir will grow as the population ages
In recent years, Izmir has seen a noticeable increase in its elderly population. By 2025, projections indicate that the group aged 65 and over will make up a significant portion of the population, with figures reaching 12.05% in IMM-9 and 13.82% in IMM-19. This demographic shift suggests a growing need for housing that caters specifically to the needs of retirees.
Izmir is already a popular retirement destination, especially for those from Istanbul, due to its relaxed lifestyle, lower living costs, and vibrant summer nightlife. These lifestyle preferences highlight why more retirees are choosing to move to Izmir, further increasing the demand for retirement-friendly housing options.
Moreover, the real estate market in Izmir is responding to this demand with a rise in senior-friendly housing developments. For instance, Eden Residence offers luxurious amenities and expert care, setting a benchmark for retirement communities in the area. This trend is supported by real estate agents who report an increase in inquiries for such housing options.
Sources: Population and Migration in Izmir, The Izmir Guide: Retirement, Cost of Living and Lifestyle, Nursing Home | Elderly Care
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12) Property prices in Izmir will rise as it becomes more appealing to local and international buyers
Izmir's residential property prices are on the rise as the city becomes a hotspot for buyers.
With a growing population, there's a steady demand for housing in Izmir. While Turkey saw a dip in home sales in 2023, Izmir's charm and infrastructure upgrades keep interest alive.
The city's transportation has improved, thanks to the Izmir Metro, making it more convenient and attractive. This ease of living draws in more residents and investors. Plus, the Turkish government's Citizenship by Investment program is enticing wealthy individuals to invest in real estate, further driving demand.
Foreign investors are increasingly eyeing Izmir for its affordability and solid infrastructure. Compared to Istanbul, Izmir offers a more affordable lifestyle with rich cultural and lifestyle attractions.
Media reports frequently highlight Izmir as a desirable place to live, adding to its allure. This buzz contributes to the city's growing attractiveness and the upward trend in property prices.
Sources: Global Property Guide, The Wandering Investor, EJRCF
13) Rental yields in central Izmir will rise as more people relocate for work and education
Rental yields in central Izmir are likely to keep increasing as more people move to the city for work and education. This trend is supported by several key factors that have been observed over the past few years.
Firstly, Izmir's population has been steadily growing, making it the third-largest city in Turkey. This growth is expected to continue, driven by the city's economic opportunities and improving infrastructure. As more people move to Izmir, the demand for rental properties naturally increases, pushing rental yields higher.
Additionally, Izmir is home to several universities, attracting a young and active population. This influx of students and young professionals further boosts the demand for rental housing, particularly in central areas close to educational institutions. The city's industrial sectors, including textiles, food, and automotive, are also expanding, creating more jobs and drawing more residents to the area.
Moreover, internal migration trends show a notable increase in people moving to Izmir, attracted by its economic prospects and enhanced connectivity through infrastructure improvements like the metro system. This migration trend is expected to continue, further increasing the demand for rental properties.
Sources: Izmir Estate, Turk Estate, Global Property Guide
14) Narlıdere will attract retirees seeking a peaceful area with good amenities
Narlıdere is becoming a sought-after area for retirees due to its peaceful environment and excellent amenities. The district is known for its abundant pinewoods and scenic trails, offering a tranquil atmosphere that aligns with retirees' preferences for a peaceful environment, as highlighted in the 2024 Retirement Confidence Survey.
Additionally, Narlıdere boasts modern healthcare facilities and recreational areas, including an outdoor swimming pool, sauna, fitness center, sports grounds, and tennis courts. These amenities cater to retirees seeking a comfortable lifestyle, making the area even more appealing. The development of new amenities, such as the largest citrus gardens in the region and numerous vegetable and flower greenhouses, contributes to the district's economic vitality and provides fresh produce for residents.
Improved public transportation options enhance accessibility for retirees, allowing them to engage in local activities and visit nearby attractions without relying on personal vehicles. Furthermore, the local government's initiatives to attract retirees by developing cultural facilities like the Atatürk Cultural Center reflect the district’s commitment to fostering a vibrant cultural scene that appeals to retirees.
Sources: Visit Turkey, Tolerance Homes, EBRI
We made this infographic to show you how property prices in Turkey compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
15) Luxury rental yields in Izmir will rise as demand from expats and business travelers increases
Luxury properties in Izmir are hot investments thanks to growing interest from expatriates and business travelers.
Izmir's population is on the rise, with a growth rate of 1.04% in 2024, largely fueled by expatriates who love luxury spots like Karşıyaka and Alsancak. This influx is reshaping the city's vibe, making it a magnet for those seeking upscale living.
The business scene in Izmir is buzzing, with more international companies setting up shop. Services like Regus are catering to these businesses, offering virtual office solutions. The government's push to attract foreign investment is also a big plus, driving demand for high-end rentals.
Tourism is another big player here. Izmir's charm as a tourist hotspot means luxury rentals see high occupancy rates, especially during peak seasons. Business travelers are particularly keen on the city's luxury real estate, looking for top-notch accommodations.
Rental yields in Izmir are climbing, with an average gross rental yield of 7.13% in Q2 2024. Luxury properties, with their premium appeal, promise even better returns. They consistently outperform standard properties, making them a smart choice for investors.
Sources: Macrotrends, Regus, Binaryx, Global Property Guide
16) Demand for eco-friendly homes in Izmir will grow as buyers become more environmentally conscious
In Izmir, eco-friendly homes are becoming increasingly popular.
In 2023, the number of residential units with construction permits in Turkey, including Izmir, jumped by 24.1%, showing a clear move towards sustainable building. This shift is not just about numbers; it's about a growing trend where people are more conscious of their environmental impact.
Local companies like Egedeniz Textile are at the forefront, offering eco-friendly materials such as hemp. This reflects a broader interest in sustainability, as seen in a 2024 survey by the National Association of REALTORS, where nearly half of the respondents showed interest in sustainable living.
The Turkish government is also pushing for greener homes with initiatives like the Nearly-Zero Energy Building (NZEB) concept introduced in 2023. This program promotes energy-efficient buildings, aligning with the nation's net-zero emission goals and the increasing environmental awareness among homebuyers.
Real estate agents are catching on, too. They're now including green data fields in MLS listings to highlight eco-friendly features, catering to the rising demand for sustainable homes. This change is partly driven by media coverage on environmental issues, which boosts consumer awareness.
As environmental awareness grows, the demand for eco-friendly homes in Izmir is expected to rise, with buyers increasingly preferring sustainable living options.
Sources: Global Property Guide, WRI Turkey, Egedeniz Textile, NAR Realtor
17) Demand for luxury apartments in Bayraklı will grow as its business district develops
Bayraklı's property values have skyrocketed by 90% in the last five years, making it a magnet for investors.
With its strategic location, Bayraklı is seeing a surge in infrastructure and public transport investments. The area boasts a robust transportation network with the Izban suburban train and numerous bus stops, making it highly accessible. The upcoming Izmir–Ankara high-speed train will further enhance connectivity, drawing in more professionals and investors.
Bayraklı is not just about convenience; it's also a designated high-rise development zone. Modern towers like Bayraklı Tower and Folkart Towers are already reshaping the skyline, offering state-of-the-art amenities and sustainable designs that cater to luxury living.
These developments are more than just buildings; they represent a lifestyle upgrade. Residents enjoy cutting-edge facilities that blend comfort with eco-friendly living, making Bayraklı a top choice for those seeking luxury.
As the business district continues to grow, Bayraklı is poised to become a prime location for luxury apartments. The area's transformation is attracting both local and international investors eager to capitalize on its potential.
With its blend of modern infrastructure, strategic location, and luxury offerings, Bayraklı is set to become a key player in the real estate market. The ongoing development of its business district is a testament to its rising prominence.
Sources: Istanbul Property, Turk Estate, MDPI
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.