Fuzul/Akbal: The Future of the Real Estate Sector Will Be Shaped by Affordable Housing Funds
Foreks - Professionals from the real estate sector gathered at the RE360 Real Estate Grand Meeting to discuss the future of the housing sector. Organized by Alkaş, the meeting saw a wide participation and included a presentation by Ömer Faruk Akbal, a Board Member of Fuzul, titled “Not Just Housing, But the Future.” Akbal explained that the reason for selecting this title was their hopeful perspective on the future of the real estate sector and shared proposed solutions for better addressing society's housing needs in the future.
“We live in a world where our resources are limited, and the need for housing is continuously increasing.” In his presentation, Akbal reminded that we inhabit a world where resources are limited while the housing need is continuously growing, stating: “The global population has surpassed 8 billion. The number of houses varies between 2.3 and 3.5 billion. The annual housing requirement worldwide is 40 million. Turkey's population is approximately 86 million, with around 25 million housing units. It is observed that an average of 600,000 to 800,000 units are needed per year in Turkey. Additionally, looking at Turkey as a whole, we encounter the fact that the homeownership rate has decreased while the rental rate has increased over the years. While higher income groups do not experience a significant drop in homeownership rates, sadly the real break is seen in the low-income group. Therefore, we can comfortably say that the fundamental cause of the housing problem in Turkey is significantly related to low income.”
“What would it change in the sector if 1% of the investment funds in Turkey could be directed towards affordable housing production?” As Fuzul, Akbal stated they have been operating in the real estate sector for approximately 33 years, during which they have tried to meet the real estate needs of thousands of families across high, middle, and low-income groups. He mentioned that they had the opportunity to experience consumer habits in different segments during this process, and continued: “Today, Turkey has a total investment source of 29 trillion TL, including 1.2 trillion TL in individual retirement funds, 4.4 trillion TL in capital market investment funds, 6 trillion TL in checking accounts, and 17 trillion TL in time deposits. If we could allocate 1% of this source, which corresponds to 290 billion TL, to housing production—equating to a capacity for producing approximately 100,000 houses, it would open the door to significant changes. So, why can’t these funds be directed towards affordable housing production? There are two main issues here: the long investment duration (4-7 years) and the associated risks. Thus, it leads us to the conclusion that if we minimize risks and shorten the investment duration to 12 or 24 months, we could achieve a substantial increase in resources in the sector.”
“The solution is affordable housing investment funds.” At this point, Akbal emphasized that Turkey has a strong ecosystem for affordable housing systems, stating, “We have land suppliers, real estate investment trusts (GYOs), as well as lands owned by private companies and individuals. There are significant project developers in branded housing and mass housing in Turkey. We have financial institutions. But we are missing one thing: a funding source that can work all of these together! By establishing a model under the name of affordable housing investment funds; where we can acquire land from land suppliers, develop it with project developers, and provide financing to consumers through financial institutions, there will be no obstacle to the development of this system.” Akbal noted that the total size of affordable housing funds worldwide has reached 57 billion dollars and emphasized that thousands of people are applying for TOKİ drawings today, highlighting Turkey's enormous potential in this area.
“Our fundamental value regarding housing should be the concept of family.” Akbal expressed that the underlying value of all existing issues related to housing is the concept of “family,” stating, “During the earthquake on February 6, we all felt the sorrow of being homeless and family-less to our core. Therefore, I believe it is crucial to approach the housing issue as a social value rather than solely analyzing it economically in the coming years.”
Among the other speakers at the RE360 Real Estate Grand Meeting were Yonca Aközer, General Manager of Alkaş; Avi Alkaş, Chairman of Alkaş & HAN Spaces; Management Consultant Mehmet Göçmen; Prof. Dr. Oğuz Babüroğlu, Head of Sabancı University’s Research Chair & Founding Director of Participatory Management Consulting; Prof. Dr. Levent Kurnaz from Boğaziçi University; H. İnanç Kabadayı, Chairman of Ege Yapı; Kaan Yücel, Board Member responsible for Operations at Polat Gayrimenkul; Özlem Gökçe, General Manager of Extensa İstanbul; Mayor of Marmaris Acar Ünlü; Mayor of Şişli Resul Emrah Şahan; and Mayor of Üsküdar Sinem Dedetaş.