What gold? Turks most satisfied with real estate investments as 'safe port'
Real estate has long been one of the most popular investment choices for locals in Turkey. According to a latest survey, real estate continues to be the investment instrument citizens are most satisfied with.
Conducted by the Presidency's Finance Office, "Turkey Household Financial Perception and Attitude Survey" involved 15,041 participants and the findings were published Monday.
The average satisfaction rate from real estate investments was 81%, with 72% of the respondents having over 80% satisfaction, the survey results showed.
In terms of average satisfaction rate, real estate was followed by gold at 76%, term Turkish lira deposit accounts at 72%, foreign exchange at 71%, establishing a business or becoming a partner at 67% and participation banking accounts at 65%.
Sector representatives explained that people’s satisfaction with real estate is higher than that of gold and the U.S. dollar due to the value gained in the housing market.
They said real estate has always earned value in the long run, noting that individuals were also quick to cash in this investment due to the need for shelter.
Gold has been dubbed a "safe port" all over the world, said Mahmut Akbal, head of the Fuzul Group. However, Akbal said, the study by the finance office unveiled that real estate is indeed a "safe port" in Turkey.
"As a matter of fact, when we look at the total house sales in the real estate sector, we have been European champions for the last seven to eight years, which clarifies the situation," Akbal told Anadolu Agency (AA).
Threefold hike in prices in last decade
The house price index, which stood at 45.4 in January 2010, reached 146.7 in September 2020, according to data.
Akbal stressed that the Central Bank of the Republic of Turkey (CBRT) data showed there was an over threefold increase in average house prices over the last 10 years alone.
The increase in housing prices in developed countries has averaged 50% in the last 10 years, Akbal said.
"This fact lies in the qualification of real estate being an investment tool offering higher satisfaction than other financial instruments in Turkey," Akbal noted.
"As a result, the Turkish people said, 'neither gold nor dollars; real estate is a safe port,'" he said.
‘No chance of losing’
Özyurtlar Holding Chairperson Tamer Özyurt, on the other hand, claims that the real estate and construction industry ranks first in demand as the most profitable and most trusted investment tool in every period.
In addition to the premium real estate provides in the short and long term, Özyurt suggested it does not bring losses easily. Its status as a promising investment tool has a large share in this, he noted.
"Despite the pandemic period, our sector again ranked first in terms of investor satisfaction. The rise in gold prices and foreign exchange during this period also did not prevent this satisfaction," Özyurt said.
"Investors feel confident investing in real estate because they have no chance of losing," he said.
Low-risk investment tool
Nef executive board member, Selçuk Çelik, said financial assets like foreign exchange, stocks, interest rates and gold harbor risks.
"Real estate, on the other hand, is the most valuable need as it is a very low-risk investment tool that does not cause its investor to lose in the medium and long term. At the same time, it is an investment that provides a return on two different fronts due to both an increase in value and rental income," Çelik said.
He added that real estate appreciated faster in developing countries but noted that even in developed countries, it is the most important investment tool due to high demand.
For instance, according to official data, the average house value in the U.K., which was 160,000 pounds ($212,151) in 2010, has reached 230,000 pounds in 2020, Çelik said.
"The average house value in this country in 2000 was 81,000 pounds," he noted. "So, we see that a house bought in 2000 has appreciated by threefold."
In developing countries, Çelik said, the appreciation is even faster.
"As a matter of fact, the rent multiplier is 36 years in the U.K. and 21 years in Turkey. Opportunity and investment value are even higher. Therefore, it is a clear fact that real estate always provides a net and high return," he noted.
Conscious, research-oriented investment
On the other hand, Helmann Yapı Chairperson Selman Özgün said the ongoing appreciation of housing in Turkey for many years has continued due to recent exchange rates and interest rate reductions.
"Now income-oriented, conscious and research-oriented real estate investment is being made. Special advisers and fund managers are working on this issue," Özgün said.
Both value growth and easy tracking, and the fact that there are no ups and downs like in other investment tools, make real estate a reliable port, he added.
Özgün said past experience increases investment satisfaction and allows investments in this area to continue.
He said tracking real estate investment is much easier than tracking other tools, which also increases satisfaction.
İnfo: Daily sabah