While rents have dropped as much as 20 percent in some area, they have stayed at their pre-crisis levels in others and there are signs that the situation is improving in many areas of the city, according to experts.Engin Kevenk from Golden Key International in Arnavutköy, a seaside suburb, said last week that there has been a recovery in the rental market.
“There was a low point between December and March. There was a concern in the market the crisis could even spread from Greece to Turkey. People did not put their houses for sale so there was little supply,” Kevenk said.
As a result of the reduced supply in the market, property prices in Etiler, Arnavutköy and Bebek went momentarily up, Kevenk said. “Bargain-hunters that arrived on the scene looking for cheap crisis deals did not find much to buy.”
Kevenk said he expects sales to normalize during the spring. “The situation for April, May and June already looks promising. July and August will be quieter, but the market will pick up again after that.”
Number of expats down
Many of Golden Key International’s customers are expats. The rental market was already quieter before the beginning of the market turbulence because the overall number of expats in Istanbul had gone down, he said.
“For about one year, the number of expats has been low. There has been very little demand for rented properties, and some expats have even moved from A class property to B class to cut down on their expenses. Partly as a result of this, rents in Etiler and other up-market areas near Arnavutköy came down 10-20 percent,” Kevenk said.
In Cihangir, a neighborhood in the Beyoğlu district on Istanbul’s European side, the situation is slightly more stable. Ayşe Şişman of Ayşen Emlak Real Estate said the sales market in Cihangir is less active than rentals in the area – mostly because of the shortage of stock.
“We get properties to sell mainly from the long-term residents of this area who are settling in the Aegean or people who have inherited property here. In fact, few property owners here are keen to sell because rental income in Cihangir is so good,” she said.
Since January sales at Ayşen Emlak has become more active. “Here we did not witness many cases of people having to sell because of financial difficulties. The effect of the crisis stayed minimal,” Şişman said, adding that property prices in Cihangir are still modest compared to similar, centrally located historical suburbs overseas.
“Compared with France or Italy, property in Turkey is still very reasonably priced,” she said.
Rents remain steady
The rentals market was dealt only a minor blow by the crisis, Şişman said. “Rents did not increase and some customers moved to cheaper housing, for example, from a flat costing 3,500 Turkish liras to 2,000 liras. But these times are now over – we are not getting these kinds of relocation requests from customers anymore.”
Rents in Cihangir, according to Şişman, currently start at $1,500 for a one bedroom flat and increase to $1,700-2,000 for a two bedroom flat. A flat with a sea view comes with a rental price of at least $1,800.
“The situation has been getting very active since January. I think recovery is reflected also in the fact that some expats who come to teach in the international schools in Istanbul in the autumn are already now making bookings for September. The market will become even more active from August on,” Şişman said.
Rents in Şişli down
Kadir Kaya of Tekin Bebe&Kadir Kaya Real Estate in Kurtuluş, a neighborhood in the Şişli district of Istanbul, agreed, saying there is light at the end of the tunnel.
“Today, our business is largely driven by the sales side, where prices remained relatively stable and which have become very active over the past month,” he said.
On the rentals side, the situation is slightly more challenging. “Rents here went down by some 10-20 percent. When a tenant moves out, the property owner cannot increase the rent, but he has to either ask for the same sum or make it even lower,” Kaya said.
“We had a customer moving out of a two bedroom flat in Kurtuluş, and his rent was 800 liras. In the pre-crisis times we could have raised the rent to 900 liras, but now the flat may have to be advertised even for 750 liras,” Kaya added.
Like in Cihangir, Arnavutköy and Etiler, some customers have opted for cheaper housing due to financial circumstances. “One customer, for example, moved from a three-bedroom house which cost 1,300 liras to one of the same size costing 1,000 liras because, in the long term, even cheaper rent of 300 liras does make a difference.”
Kaya hopes the revival in the market will continue. “The future is looking good. We feel optimistic that the market is healing,” he said.
By REETA PAAKKINEN
ISTANBUL – Hürriyet Daily News
