Considering a Real Estate Investment in Turkey?
These days, many foreign buyers consider a real estate investment in Turkey. Bumping up the property market, in 2020, a year that saw global house sales drop because of COVID, home buyers purchased nearly 41,000 apartments and villas, a slight decrease of 11% on the year before. Over the last twenty years, the number of buyers looking to invest in Turkey has increased tenfold. Attracting real estate investors worldwide, the country impresses buyers with affordable property prices and a simplified buying process.
If all paperwork and funds are in place, buyers receive their title deeds anywhere between the same day to three weeks. Sounds great. However, the critical question is how to make your investment property work. After all, the whole point is maximising your capital growth, and in the case of some investors, achieving a passive income through rental properties. So, when you choose to invest in Turkey’s real estate market, knowledge and research are of utmost importance. Let’s look at what you need to know.
Guide to Real Estate Investment in Turkey
1: Why is Property so Cheap in Turkey?
Real estate investors often choose Turkey because of low property prices. With the average starting price of an apartment being £50,000 with freehold title deeds, it is easy to understand the lure. Buyers do not have to compromise on quality either. The reason for the low prices is Turkey’s housing market is still in the infancy of modernisation. Twenty years ago, Turks could not get a mortgage, the market was stagnant, and the quality of housing was poor. As soon as mortgages became readily available, more investment kickstarted the market. Additionally, in some areas, masses of new developments and available properties keep prices down.
2: Is Buying Property in Turkey a Good Investment?
Yes, as a mid to long term investment. But rather than looking at the country, drill down locally to find out which towns and cities show potential. Find out what municipality’s plans are and how that area operates in terms of amenities and infrastructure. Is there a good transport network? Where are the shops, banks, bars, and restaurants? Some investors like to flip houses, but that does not work here in Turkey because of the low prices. Also, avoid renovation projects because these eat into your budget and often incur more hidden costs and additional paperwork.
3: Is it Safe for Foreigners to Buy?
In the past, Turkey received a bad reputation because loopholes in the law meant some foreign buyers never received their title deeds. Thankfully, the Turkish government realised this was affecting housing sales, and they tightened up the regulation and made it quicker and easier for foreigners to get their deeds. So, yes, it is safe if buyers follow the recommended system and always use an independent lawyer. Never hand over cash, and always send money via banks, so there is a paper trail.
4: Is now a Good Time to Buy?
Yes, it is. The current exchange rate of the Turkish lira to other world currencies means foreigners get excellent value for money. Additionally, if all finances and paperwork are in place, buyers receive title deeds in as little a week. However, remember to do your local research. Some areas fare better than others for potential capital growth. Our agents all have expert local knowledge of the regions they operate in and can advise further.
5: Residency and Citizenship by Investment
Many people ask if home buyers get residency automatically in Turkey. However, buying property and getting residence are two separate processes that are not connected. The excellent news is residency is quick and easy to complete. Applicants need to show they can financially support themselves and, if under 65, have adequate health insurance. In addition, one reason property investors like Turkey is their citizenship by investment scheme. Anyone who buys property worth at least $250,000 and pledges to keep it for at least three years is eligible to apply. Once again, our agents can advise further about residency and citizenship.
6: Investing in Rental Properties
Some investors also turn to the rental property market to generate a monthly cash flow from their investment. However, research the market first. Some areas are flooded with holiday rentals hence driving prices down, while in others, there is a shortage of long-term rental property. The place that presents the highest rental yields is Kalkan, on the Mediterranean coast. This upmarket resort is known for its large, private villas with pools and fantastic sea views. You will need clever marketing and advertising skills to maximise your occupancy. Likewise, if you do not live in the area, you will need to employ a management company to manage the rentals. Everyone who stays in the property must be logged onto Turkey’s official system, and landlords pay income tax as well.
7: Where is the Best Place to Buy?
As a vast country, Turkey presents many areas with ideal housing markets. To tap into the touristic ambience and use the property for summer holidays or year-round living, buy a home on the Mediterranean or Aegean coasts. Large cities are ideal to rent out your property long term since many city workers rent apartments. Let us look at where most foreigners buy homes.
Istanbul: The most popular place for buyers investing in property is Istanbul, Turkey’s largest city. Most buy apartments or penthouses in new developments, hence saving money on off-plan prices. Some developers also offer interest-free long-term payment plans of up to 5 years. The general trend in Istanbul’s housing market is large lifestyle residences where apartment owners also have a range of onsite facilities like a swimming pool, gym, sauna, and landscaped gardens.
Antalya: Sitting on the eastern Mediterranean coast, Antalya is Turkey’s most popular tourist destination. One reason is the range of stunning beaches, which many say are the best in Turkey. As well as the cosmopolitan city centre, the region includes smaller resorts like historical Side, lively Kemer, and Belek, Turkey’s golfing capital. Alanya, another destination, is fast-growing and offers excellent property prices.
Fethiye Region: Also on the Mediterranean coast, the Fethiye region is also a top touristic destination and home to large communities of ex-pats from around the world. Popular places to buy property include Calis Beach, Hisaronu, Ovacik, and the town centre. As a central sailing hub of the Turkish riviera, places like upmarket Gocek also feature the marina lifestyle. Fethiye is another area that presents excellent value for money when it comes to property prices.
Bodrum Peninsula: Heading over to the Aegean coast, Bodrum’s upmarket ambience makes it a haven for millionaire properties, especially in Yalikavak, which attracts mega yachts from all around the world thanks to the ultramodern marina. Serviced by the main Bodrum airport, coastal resorts with a typical tourist lifestyle including water sports Gumbet, upmarket Golturkbuku, Turgutreis, and rustic Gumusluk.
Start Your Property Search
To understand what is on the market for sale and what buyers get for their money, browse our portfolio of apartments and villas for sale in many areas of Turkey. Each listing contains everything to know, including price, photos, location, home features and contact details to find out more via email or arrange a viewing.
Speak to an Agent
Alternatively, if you have more questions and would like to speak to an agent, call us today. Our agents all have expert knowledge about the housing market and which areas show potential for the best investment for your property portfolio. Our blog also includes more useful articles about real estate investment in Turkey.