Impact of Foreign Investors on the Turkish Construction Industry

Department of Real Estate Development and Management Faculty of Applied Sciences, Ankara University, Ankara, Turkey

^* Corresponding author: aliefendioglu@ankara.edu.tr

Abstract

This study investigates the calendar and calendar-seasonal effects on foreign investors’ housing acquisitions in the Turkish real estate market and its influence on the Turkish construction indexes. Understanding the pattern of housing acquisition by foreign investors in Turkish real estate could be essential information for policymakers. The Turkish statistical database reflects 23 prominent countries’ foreign housing acquisitors in Turkey, and all data were analysed. This study employed quantitative analysis of unbalanced panel data obtained from Turk-Statistics, which ranges from January 2015 to May 2023. The pooled Mean Group/ ARDL Lag model was used for the analysis. The finding established a long-run positive association between foreigners’ housing acquisitions in Turkey and Turkish construction indices. The short-run trend is positively significant for all foreign investors across the model. In addition, the finding revealed that a series of lag construction indices and housing acquisitions predicted short-run deviations. The finding closes the research gap and contributes crucial information to the policymakers in taking necessary policy action when required. The study also provides essential information to foreign investors on their investment decisions, especially on the relationship between foreign housing acquisitions and the influence of the Turkish adjusted construction indexes.