Investment Properties in Turkey

Turkey is among Europe's finest attractive real estate markets and among the best places for investment in properties, as it is focusing on its advantageous location to attract foreign investors. Turkey, ideally positioned at the intersection of Europe, the Middle East, and Central Asia, with a population of 83 million people, provides excellent potential for real estate developers and investors who are willing to invest in properties in Turkey, by integrating a heavy construction industry alongside expanding urban and business production.

Every passing year Turkey is noticing a huge breakthrough in its real estate market since the country provides the most beneficial profits to investors. By drawing the attention of international investors as the sole profitable investment option, the Turkish real estate market gives investors 150 percent earnings. In the following parts, we will go over all of the specifics of real estate investing in Turkey.

• How to Choose a Real Estate Investment? 

There are a few things to think about before an individual starts the process of investment properties in Turkey. The stages to selecting a real estate market include initially deciding on a city and then locating the ideal area in which to purchase a house. Many of the finest areas to invest in share the same traits.

According to the growing regional market of the real estate market, it will be simpler for an investor to select a convenient option in such a place where he/she may rent or sell the apartment. Factors that should be considered while investing in Istanbul real estate are:

• Rental Returns

In Turkey, rental units are a common type of investing in real estate. Real estate is a reliable source of consistent income, with rental income ranging from 8 to 11 percent compared to 2-4 percent for residential real estate. Commercial real estate management is cheaper and easier than residential property management. This needs less administration because these assets are cared for by experienced project maintenance companies.

A further advantage is that the landlords don't get to spend money on renovating the property because the renters would furnish it according to their preferences and needs. Short-term rentals are favored for residential property, whereas a 3+3+3-year contract with a preset rent increase is negotiated for commercial property.

• Financing

Before investing in a property in Turkey, the investor should be aware of the budget and how much he/she is prepared to invest in a property.

Financial institutions in Turkey provide mortgages for real estate investment, however, the conditions and rates vary depending on the property type. Banks make it simpler to obtain funds for a residential property that is worth at least 90% of the property's value. Credits for commercial property, on the other hand, are significantly more difficult to obtain, and only 60% of the property value is guaranteed.

The interest rate is substantially higher and is only appropriate for an investor if there are sufficient funds available. Still, if an investor has a limited amount of money, it should be better to invest in residential real estate.

• Re-Selling the Property

Selecting the ideal investor is a time-consuming and difficult process when leaving or disposing of real estate holdings. If an investor has invested in a commercial property in a certain industry, the economic situation will have a big impact on the commercial property. And whenever the market will be slowed down, it might be difficult to locate a purchaser and sell the property.

An investor may even have to make certain concessions, such as on rent. In contrast to the residential unit, there is one potential with commercial real estate: it may be sold partially

• Rental demand

Evaluating the market is essential for real estate investing in Turkey, as it is in every sector. It is critical to ensure that an investor targets a market with consistent rising rental demand, also, it should be understood of the target audience if we do not want to halt cash flows.

When assessing real estate rental requirements, turnover rates, days on the market, population increase, and the number of rental properties vs. current inventories must all be considered.

• Exchange Rate

If you wish to make a real estate investment in Turkey, you need also consider the growth and fall of the Turkish Lira. The exchange rate between foreign currency and the Turkish Lira will mostly benefit the investor's purchase.

When trading in the Turkish lira in return for the investor's money, time is critical since the Turkish currency has dropped 30% of its value in a year, giving indirectly a 30% discount. As a result, investing in Turkish real estate is crucial while the Turkish Lira is low.

• The Importance of Location in Real Estate Investment

Because of the numerous advantages, real estate is a great alternative for diversifying financial assets. It is also critical to take all the time needed while selecting and purchasing the perfect property that will give a future financial performance.

When looking to invest in real estate, the investor must consider the property's growth in value, which is decided by how enticing it appears to prospective buyers. If one intends to rent out the home for general revenue, the location is critical. Individuals choose residences that are nearer to their workplaces or have a shorter commute to other locations

Obviously, any property will be in more request if it is near to central locations. It is also advantageous to invest in property in such a region that will increase in value in the future owing to infrastructural projects in order to generate significant profits quickly.

Nevertheless, for others who like peace and quiet, the loudness and traffic might be a deterrent. When determining home alternatives, it is also important to consider proximity to facilities such as stores, restaurants, cafés, gyms, and family tenants. People are more likely to be attracted if the schools are close to the property.

When investing in real estate, take into account that the investor should also be seeking a prospective renter. Investing in a growing neighborhood will enable the buyer to achieve his/her long-term investment strategies.

• When is the Best Moment to Invest in Real Estate?

Location is an important consideration for many individuals when investing in real estate. Time is also an important consideration in investing decisions since it can affect the long-term sustainability of an investment.

Because an investor may be required to pay a down payment ranging from 3% to 20%, the optimal time is when the monetary sustainability is respected. The investor will also be responsible for closing charges ranging from 2% to 5% of the purchase of the property. Aside from these costs, there will be monthly payments, real estate taxes, insurance, utilities, and so forth. Financial stability is required to cover these costs and prevent debt.

Before making a purchase, the investor should carry out research to reduce risk and optimize return on investment. First and foremost, one should do a real estate market study of the area in which you intend to invest, Furthermore, after identifying a neighborhood and selecting classified or off-market properties, rental property study will be needed. Ultimately, property expertise is required to discover flaws in the property.

Before purchasing, the season and time of the year should be taken into consideration also. For instance, because there are fewer purchasers in the marketplaces during the winter, prices tend to fall.

This is where real estate companies and their expertise, such as ours in Panorama Property, will provide all the necessary help since we do have experience in the field and a big network with construction companies’ portfolios.  

In the best investment projects, buying apartments in Istanbul turkey remains a preferred option for investors.

Some Highlights and Numbers about Real Estate in Turkey

• Foreign Direct Investments fluxes stood at 7.8 billion dollars, real estate represented 4.4 billion, only real estate had a total share of 57% of Foreign Direct Investments
• In the coming years, urban regeneration and massive projects will monopolize the scene, especially in Istanbul. Marmaray, the Yavuz Sultan Selim Bridge, the Eurasia Tunnel, and Istanbul Airport are among the city's initiatives.
• 7.5 million residential units will be included in the Metropolitan Rehabilitation and Development plan. The plan has a USD 400 billion budget, with the business sector contributing significantly.
• In 2020, the overall number of properties purchased in the Turkish real estate market surpassed 1.5 million units; similarly, sales of real estate to foreigners began to expand following the repeal of the reciprocity law in 2012. In Turkey, 40,812 properties were sold to foreigners in 2020. With 19,175 sales to foreigners in 2020, Istanbul was the top-performing province, followed by Antalya with 7,735 sales, Ankara with 2,746 sales, and Bursa with 1,340 sales.
• By the end of 2020, Istanbul's current Grade A office stock would have topped 5.6 million square meters. More than 1.7 million square meters of office supply, such as the Istanbul International Finance Center (IIFC), were under development, and the total grade A office supply is anticipated to reach about 7.4 million square meters gross leasable area by the end of 2022.
• In 2020, the overall industrial real estate output in Istanbul and Kocaeli was 10.2 million square meters. In 2020, 318,000 square meters of logistics rental agreements were completed, nearly tripling the number from the previous year's conclusion.
• In 2021 Turkish citizenship by investment increased by 44%, the nationalities who were most interested in Turkish citizenship were: Egyptians, Germans, Iranians, and Russians.

We, in Panorama Property, hope this information is useful, and we are so proud to be your first choice for a secured and guaranteed investment in Turkey. We are also proud to be the only company that provides you with all these services for the best price and quality.