Oct 26, 2023

Real Estate (Property) Investment in Türkiye

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Real Estate Investment in Türkiye

Türkiye is considered one of the leading countries in the field of real estate investment. This is because of the distinguished and integrated services it provides; especially, with the jewel of the East, Istanbul, which is considered today one of the most important real estate investment destinations around the world. Istanbul today surpasses famous European cities. Therefore, in this article, we will learn important real estate tips before investing in Türkiye.

Tips for Real Estate Investment in Türkiye

Real estate consultants focus on several basic tips in the world of investment that would maintain the market value of the desired property and avoid any financial losses. Among these tips:

Analyze the Turkish investment market: Intensive market analysis is considered one of the most important factors that help investors avoid any mistakes that might make then exposed to during the investment process in the country. This analysis gathers necessary data, which, in turn, leads to a safe investment.
Determine the goal: Investors wishing to embark on the real estate investment experience must define their goal from this experience. Here, such a goal is divided into two basic types:
Long-term investment: This type, for instance, specializes in hotels; therefore, waiting for rental returns until the capital is collected may extend to a period of more than 10 years.
Short-term investment: Buying properties under construction at cheap prices, then selling them upon delivery at higher prices.
The appropriate location: Investors must pay attention to the property's geographical location before the purchase process. Such a factor represents an important and major role in determining the financial value of the property. The quality of the site depends on several main variables, namely:

Region.
The view.
Infrastructure.
Transportation.

For example, if the project is located in an investment area with developed infrastructure, a distinctive sea view, and a location close to transportation, it will have great financial value and greater demand. On the other hand, if the project is located in an unattractive area, with a dull view, and a location far from transportation, then the demand will be weak with a low financial value; regardless of building materials and interior design quality.

Choosing a Real Estate Developer to Ensure a Successful Investment

In Türkiye, many real estate developers in the governmental and private sectors operate, and each department has its pros and cons. However, most of the investments are made through government construction companies, which are more feasible and safer to invest money directly with the Turkish government. However, private companies in real estate development are also distinguished by their many varied options with high-quality finishes and interior designs.

Likewise, real estate marketing companies are quite active in Türkiye. Still, a real estate broker is considered the entity that can guide the investor on the right path during the investment journey. For this, one must choose the right broker who has a good reputation in the field of real estate marketing.

Investing for Financial Return

Real estate investment for financial return is one of the best methods of investment because of its advantages that benefit the investor financially; whether by leasing the property or profit after the sale. The percentage of investment loss is quite minimal compared to other types of investments, such as investments in financial markets or stocks. Therefore, real estate investment is described as one of the best, safest, and safest investments in terms of preserving capital and low levels of risk.

The Expected Return from Real Estate Investment in Türkiye

A clear difference is shown in the achieved rates of returns; especially when considering the city in which the investment is made, the property type, the investor buying the real estate, the extent of his/her experience, and his/her ability to make optimal use of the purchased property.

Also, the percentage of returns from real estate investment is described as among the highest percentages of profits in the real estate market at the European level. This is due to several reasons, including:

The annual increase in Turkish real estate prices.
The high demand for real estate investment in the Turkish market.
Low tax rates applied to profits resulting from the real estate trade.

For these previous reasons, a property's profit in Türkiye varies according to the region, the property quality, and the investment field; as the profit rate in some areas can reach 20% of the total property value per year.

Is Real Estate Investment in Türkiye a Safe Option?

Real estate investment is one of the safest investments and cannot be seized or stolen, as it is not transferable; making mortgages the most adopted in most courts as a means of guaranteeing rights. Likewise, real estate has many advantages, including not being subject to bankruptcy standards that exist in banks and the fact that Türkiye is one of the countries where the real estate market is growing at amazing rates.

Turkish Citizenship through Real Estate Investment

Turkish citizenship is granted by purchasing a property for the purpose of housing or investment, provided that its value is not less than $400.000. Here, it must be clarified that not every property worth $400.000 or more is suitable for the country's nationality; where the price evaluation must be issued by the government, in addition to a condition stating that the property owner is of Turkish origin.

The effects of granting Turkish citizenship by owning a property appeared in the proportions of real estate purchases for the purpose of citizenship among all foreign purchase transactions of real estate in the country. One-fifth of the real estate investments of foreigners were conducted in the country for 2021 with 40 real estate investments by foreigners in Istanbul, which were to obtain Turkish citizenship. However, there are many conditions to ensure obtaining citizenship, including:

It is not possible to buy a property from a company registered in Türkiye owned by the buyer or one of his relatives.
Obtaining the Real Estate Department's appraisal at the real price of the property and paying attention to the validity period of the appraisal, which does not exceed 3 months.
The evaluation amount should not be higher than the purchase amount, taking into account the existence of Value-Added Tax (VAT). This aims to make the evaluation value equal to the purchase price without tax.
Showing the money transfer from the buyer's personal account to the account of the project owner, while avoiding the transfer through agencies.
In the event of a purchase from a project, investors must pay attention to the account holder's name to whom it is transferred and the name of the property owner. In this case, a document proving the relationship between them must be requested.
The transfer notice must include an explanation of the reason for the transfer (e.g., the real estate purchase).
The notice must be attested by the entity issuing it (e.g., the bank).
In the event that there is a mortgage on the property, it must be lifted within 5 days from the purchase date to benefit from it by applying for citizenship (it is preferable to remove it before transferring ownership).
There is no time frame for the purchase; meaning that it is possible to buy more than one property with separate periods of time to obtain citizenship while paying attention to a new evaluation of all properties when submitting the application.
In the event that a property is purchased by installments or purchased while being under construction, all installments must be paid before submitting the application.
Obtaining an estate easement deed, which is a title deed that proves the ownership of the deed's owner in the building that is constructed.

After meeting these conditions, the Land Registry Department submits the application to the General Department of Title Deeds and Real Estate Registry, which, in turn, studies the application and sends an e-mail carrying documents of authentication or conformity. This authentication states that the property that was purchased at the value paid conforms to the conditions stipulated in the law to obtain Turkish citizenship.

Advantages of Turkish citizenship

After adhering to the law of applying for Turkish citizenship and then obtaining it, the recipient enjoys many advantages that open many horizons for him/her. The following are some of these advantages:

Speed of Procedures: Obtaining Turkish citizenship or passport does not take long, as this period does not exceed 4 months only.
Granting Citizenship to the Family: The family, represented by the wife and children, is entitled to obtain citizenship, except for children who are over 18 years old.
Disposal of Investments: After obtaining citizenship and the passage of 3 years, your investments can be disposed of and then the money that was paid can be recovered.
Investment Diversity: The law on obtaining Turkish citizenship provides many options for investors and they can choose the method that suits them in their real estate or commercial investment.
Low Expenses: This matter relates to the administrative expenses and government fees imposed when adding a family member to the file for the Turkish citizenship application. This matter constantly attracts many investors to Türkiye in particular.

Istanbul: real estate investment excellence

Turkish cities are generally witnessing a growing demand by investors to enter into multiple real estate projects and enjoy the advantages of real estate investment in the country. However, Istanbul is one of the most impressive cities for investors and suitable for the aspirations they want to reach; especially, with the great demand for the city's estate by tourists and residents, which made its economy quite unique and made the real estate field continuously flourish.

Therefore, as the Homeland Real Estate Company team, we are ready to provide free real estate consultations to fulfill your desire to own a distinguished property. Do not hesitate to contact us at +905377793006.