The complexity of a new property tax system in Turkey, which is also increasing the cost of buying and owning real estate, may not be welcomed by foreign buyers, according professionals in the real estate sector.

The Turkish property market had been witnessing an increase in foreign property buyers since the enactment of a bill which eased restrictions on the sale of land and real estate to foreign citizens, introduced in May 2012. In that month alone, foreign real estate acquisitions in Turkey reached $1.1bn, which was four times more than the whole of 2011.

Nearly 112,300 foreigners have bought 90,000 properties in the top ten Turkish cities, while Antalya is the leading province where 34,000 properties were sold to foreigners, according to December 2012 data provided by the Environment and Urban Planning inventory.
The Association of Real Estate Investment Companies (GYODER) has pulled its 2013 growth forecast for the Turkish construction sector down 1-2% due to the VAT increase, also claiming that five companies may postpone IPO plans because of the possibility of an additional tax to be paid by property developers.