A Widening Gap Between Demand and Supply in Istanbul’s Housing Market
Turkey’s largest metropolis, Istanbul, is experiencing a critical housing shortage, according to real estate professionals and construction sector analysts. The city’s population continues to grow, yet housing production is failing to keep up, creating deep imbalances between supply and demand.
In recent years, Istanbul has seen a sharp decline in new housing project completions, while at the same time, interest in the city’s real estate—both from locals and international buyers—continues to rise.
Rental Prices Surge as New Construction Slows
In the first quarter of 2024, there were only 13,048 residential units sold in Istanbul, according to the Turkish Statistical Institute (TÜİK), marking a significant drop compared to previous years. Industry professionals note that the lack of affordable housing and limited new development are pushing rental prices to record highs.
In major districts such as Beşiktaş, Kadıköy, Şişli, and Bakırköy, rental increases have exceeded 100% over the past two years, making it increasingly difficult for middle-income families to find suitable accommodation.
“There Is a Serious Shortage in the Housing Supply”
Şerif Varlı, General Manager of Vartur Real Estate, emphasizes that the city’s existing housing stock is insufficient to meet demand:
“There is a serious shortage in the housing supply. Prices in central districts are increasing rapidly. Those who can’t afford to buy property are now turning to rentals, which puts additional pressure on the rental market.”
He added that this situation is driving more investors to consider purchasing properties in surrounding neighborhoods, where prices are still relatively accessible.
Foreign Demand Still Strong Despite Price Pressures
Despite rising costs, Istanbul remains a top destination for foreign investors. According to Şerif Varlı, interest from international buyers—especially from the Middle East and Europe—has not waned. Many view Istanbul as a long-term opportunity due to its strategic location, dynamic economy, and cultural appeal.
However, with limited new developments in the pipeline, experts warn that the housing crunch may worsen unless construction activity increases in the near future.
A Market Under Pressure—and Opportunity
Istanbul’s housing shortage presents challenges for residents but also signals a high-demand market for both domestic and international real estate investors. As the city continues to grow, those who invest strategically—especially in developing districts—may benefit from long-term appreciation and rental income.
