Posted on 18 June 2011
During the boom emerging markets took on an appeal all of their own as they became known for their self-perpetuating cycles of strong growth. Economic growth would lead to rising affluence, which would lead to increasing demand for housing, house prices would be pushed up as a result of this combined with general inflation, increasing house prices would lead to expanding developers, pushing more money back into the economy and restarting the cycle.
Now Turkey has just that cycle times 2, it has that cycle in the economy/housing market, and also in the tourism sector as well, tourism is booming, which is leading to more tourism because it leads to increasing flights, which increase tourism and thereby lead to increasing flights, and it also leads to more word-of-mouth advertising, which increases tourism and again increases word of mouth advertising.
This cycle in Turkey can be seen each week, with the continually positive flow of economic news. In the last few weeks we have had to record breaking months in export growth, two record-breaking months of car-sales and manufacture, and Istanbul voted one of the top 10 cities in the world for tourism growth, not to mention predictions for GDP growth of over 6% from the EU, OECD and World Bank.
The only other countries that can boast this much economic growth potential and power are in Asia. Like Turkey the places in Asia scream out to global property investors, but Turkey has one advantage. In most (if not all) of the Asian countries, the government’s are fighting runaway price growth to avoid a — what seems like inevitable — bubble, while Turkey property prices are growing at around 6% year on year according to Gyoder. I know where my money is going.