Turkey has slashed the financial and investment criteria for foreigners to become Turkish citizens, a move expected to double annual property investment by foreigners to around $10 billion, Reuters reported, citing sector officials.
The government has been taking measures to boost investment in the economy and shore up the lira, which has fallen 40 percent this year due to jitters about President Recep Tayyip Erdoğan’s sway over monetary policy and a row with the United States that has triggered reciprocal sanctions and trade curbs.
According to the new regulations, foreigners can become citizens if they own property worth $250,000 for three years, down from a previous value set at $1 million, or if they hold $500,000 of Turkish debt for three years, down from a previous $3 million.
The reduction of the minimum limit to invest for citizenship is expected to double property sales and bring in cash that would otherwise be invested in Greece or other European Union countries, sector officials said.
Foreigners purchased $4.6 billion worth of properties last year, with a large proportion of them from Iraq, Saudi Arabia, Kuwait and Russia, according to official data.
“Annual sales of $10 billion is not an unrealistic amount; it can be achieved with the new regulation change,” Real Estate Investment Association (GYODER) Chair Feyzullah Yetgin said.
Turkish home sales dropped 12.5 percent year-on-year in August. However, property purchases by foreigners were up around 130 percent, focused mainly in Istanbul and holiday destination Antalya, data released on Wednesday showed.
Turkey has introduced measures to tackle the slowdown in the housing market including lowering mortgage rates by state lenders and discounts by well-known property construction firms.
“A citizenship industry was created recently for example in Greece and Portugal. The competition may work well for Turkey now,” said Makbule Yönel Maya, the general manager of TSKB Real Estate Valuation.
Under the new rules, foreigners can qualify for Turkish citizenship if they meet any one of a series of criteria. The sharp reduction in the required foreign currency value applies to fixed capital investments and bank deposits as well as properties and bond holdings.
The amount of required fixed capital investment was reduced to $500,000 from $2 million, and the size of bank deposits was cut to $500,000 from $3 million, the decision published in the Official Gazette said.
It also halved the number of employees an applicant must employ to gain Turkish citizenship to 50 from 100.