Foreign Real Estate Investors Are Rethinking Turkey: Why Istanbul Is Losing Ground to Izmir, Ankara, and Sakarya
Something surprising is happening in Turkey’s real estate market in 2025. While total property sales are climbing, foreign buyer activity is slowing down, and the attention of foreign investors is shifting away from Istanbul. Interestingly, cities like Izmir, Ankara, and Sakarya are becoming more attractive cities among international investors. This trend is more than a temporary dip. It's a reflection of changing investor needs, market congestion in some areas, and fresh opportunity in others.
So, what is really behind this change that happened? What does it mean for property prices and rental demand?
Why Foreign Buyers Are Pulling Back from Istanbul
Let’s start with the obvious point of view. Istanbul is no longer the automatic first choice for global investors. In the first four months of 2025, home sales to foreigners in Istanbul dropped by nearly 6%. It's not just about numbers, it's about a set of mind. For years, the city saw massive price increases, especially after the citizenship-by-investment (CBI) threshold was increased to $400,000. As values skyrocketed, many overseas investors stopped seeing Istanbul properties as profitable investments.
Foreign buyers still purchase in Istanbul, however, with far more specific goals. The era of speculative mass buying is cooling off.
On the other hand, Izmir is quietly becoming a star. Properties with sea views, a more easygoing lifestyle, and lower price points make it an attractive option. In many cases, buyers are getting larger m2, more spacious homes for significantly less than they had spent in Istanbul.
The New Real Estate Triangle: Izmir, Ankara, and Sakarya
While Istanbul is stabilising, three cities are picking up steam:
Ankara: As the capital city, it offers political stability, a strong rental base from embassies and institutions, and a growing sense of long-term investment potential.
Izmir: With its vibrant lifestyle, coastal charm, and European feel, it's gaining fans, especially among European and lifestyle-focused buyers.
Sakarya: Close to Istanbul but far more affordable, Sakarya combines nature, urban development, and strategic location. It’s especially appealing to buyers from the Middle East.
All three have seen foreign interest surge by 13–21% this year alone. More interestingly, this isn’t just about foreign investors. Local buyers are following the trend too, pushing up demand, competition, and prices.
What Does This Mean for Renters and the Rental Market?
The impact is not just limited to buyers. As demand rises, rental prices in cities like Izmir and Sakarya are also climbing fast, in some cases by 20–30% in a year.
The supply of mid-range rentals can’t keep up, especially in districts popular with both locals and expats. If you're a renter in these areas, your choices are narrowing, and rents are rising.
In Istanbul, the rental market may stabilise slightly in the short term. But don’t expect prices to crash. The city’s massive population keeps housing demand strong, particularly in the mid-to-low price segments.
Final Thoughts: The Bigger Picture in 2025
So, is Istanbul losing its shine? I might say not exactly.
It’s still one of Turkey’s most important real estate hubs. But we’re seeing a healthy, strategic shift, away from inflated quick wins, and toward smart, sustainable growth.
For investors, this means looking at cities that offer long-term value, liveability, and room to grow. And for renters and homeowners alike, it’s a reminder that Turkey’s property market is far more distinct and dynamic than it was even five years ago.
In today’s market, it’s not just about “where” you invest—but “why.”
Whether you're an overseas investor, a Turkish buyer, or a property advisor, the message is clear: opportunity is expanding. If you're ready to explore new horizons in Turkish real estate, now’s the time.
