Istanbul has survived more forecasts of its decline than almost any market we follow. It is worth being precise about which of its fundamentals are actually holding, and which two have quietly weakened.
What is holding
Household formation continues to run ahead of completions in the districts that matter, and the city keeps absorbing internal migration at a rate that no amount of new supply has yet met. Land in the well-connected corridors remains genuinely scarce, and scarcity of land is the only durable moat in residential development.
Construction cost has stopped being the story
For three years the input-cost line dominated every conversation. It no longer does. Costs remain high, but they are predictable, and a developer can price predictability.
What has weakened
- Exit liquidity at the top end. The buyer pool for large units has thinned, and it thinned faster than headline pricing suggests, because transactions that do not clear never appear in the index.
- The currency argument. International buyers who underwrote on a currency view rather than on rental yield have had a difficult two years, and that cohort is not returning at the same size.
A market can be resilient and still be a bad place to be under-capitalised. Those are separate statements.
Our own position is that Istanbul residential remains investable on rental fundamentals and delivery capability, and is not investable on a currency thesis. That has been our position for some time and the last eighteen months have not changed it.