Turkey’s real estate market has experienced significant growth and development over the years, becoming one of the most attractive markets in Europe. In 2021, Turkey sold a staggering 1.5 million properties, topping all other European countries, according to data from the Turkish Statistics Authority. This accomplishment, in addition to the country’s strategic location, stable economy, and robust investment opportunities, makes Turkey an ideal location for real estate investment.
For those interested in investing in the Turkish real estate market, it’s essential to have a thorough understanding of the market’s advantages and potential drawbacks. At Move 2 Turkey we provide valuable insights into the benefits of investing in Turkish real estate in 2022, as well as how the Turkish lira crisis has affected the industry.
This article explores the advantages of real estate investment in Turkey and provides an overview of how the Turkish lira crisis has impacted the market. Additionally, we’ll take a closer look at Move 2 Turkey’s six significant benefits of investing in the Turkish real estate market, giving potential investors a comprehensive understanding of why Turkey is an excellent location to invest in real estate.
1. Increasing Returns On Investment Over Time
Investing in real estate in Turkey has become increasingly popular among international investors due to the country’s attractive tourism industry, which is at its peak during tourist seasons. This demand creates an opportunity for investors to rent out their properties and receive a good investment return.
Real estate investment is renowned for maintaining its real value, and properties in Turkey can bring annual profits through investment returns obtained through resale or leasing, which can be as high as 12% of the original property value. Moreover, long-term real estate ownership in Turkey can lead to increased returns due to the property’s appreciation in value over time, which can lead to an increase in capital.
Not to mention that investing in Turkey is also considered safe, and the continuous demand for rental properties provides a semi-fixed additional income, making it an attractive destination for investment.
However, investors must exercise caution when buying properties in Turkey, ensuring that they buy at a competitive price compared to similar properties in the area. They should also invest in the property optimally by either renting it out at a special rate or selling it for a profit.
To ensure a sound investment, it is advisable to seek professional advice from companies such as Move 2 Turkey, which provides guidance and support through all stages of real estate investment in Turkey. With their expertise, investors can make informed decisions and enjoy the benefits of investing in Turkish real estate.
2. Obtaining The Turkish citizenship
The option to obtain Turkish citizenship has made Turkey one of the most desirable countries in the world for real estate investment. Owning a property worth $400,000, whether it is an apartment, office, villa, or shop, can qualify an investor for Turkish citizenship under reduced terms. This has proven to be a strong motivator, particularly for those coming from unstable countries, to purchase real estate in Turkey, despite an increase in real estate prices.
The Turkish government has taken this matter seriously and streamlined the process for investors to acquire citizenship. As a result, many investors from Arab and neighboring countries have turned their attention to real estate investments in Turkey to reap both profit and citizenship simultaneously.
This policy has had a significant impact on the percentage of real estate purchases by foreigners in Turkey, with more than one-fifth of the investments made in 2021 being for the purpose of obtaining Turkish citizenship. Nearly 40% of these investments were made in Istanbul, further highlighting the city’s potential for growth and development.
3. The Governmental Support For Turkey’s Real Estate Sector
Real estate investment in Turkey offers numerous benefits, one of which is the special attention given to the real estate sector by the Turkish government. This is evident in the many real estate campaigns and initiatives that have been launched in recent years.
In fact, in 2017, President Recep Tayyip Erdogan issued a special appeal to revitalize real estate companies across Turkey and promote the sector through various campaigns. One of the largest campaigns included the sale of apartments throughout Turkey in convenient installments of up to 240 months.
To further encourage real estate investment, several measures were implemented. For example, some real estate companies have eliminated interest rates entirely, as directed by the President. Additionally, the advance payment required for purchasing property in installments was reduced from 25% to 20%. Foreigners and expatriates who buy real estate in Turkey have also been exempted from paying value-added tax.
Moreover, Turkish law grants foreign investors the right to obtain real estate residency for themselves, their spouse, and their children by purchasing property in Turkey. Furthermore, a decision was made on September 18, 2018, allowing foreign investors who own a property worth $400,000 to apply for Turkish citizenship. All these initiatives and incentives demonstrate the Turkish government’s commitment to promoting and facilitating real estate investment in Turkey.
4. A market full of promising and rewarding opportunities
The real estate market in Turkey offers a multitude of opportunities and options that are unique and varied. The strength and distinction of real estate in Turkey is due to the vastness of the country, the different nature and climate of its cities, and the strength of its infrastructure. All of these factors contribute to the multiplicity of real estate options available throughout the country, and the competitive pricing that makes investing in Turkish real estate a growing opportunity, from east to west and from north to south.
Whether you’re looking for commercial real estate, such as offices and shops, or residential properties, such as villas and apartments, Turkey offers a wide range of options to choose from.
One of the key advantages of investing in real estate in Turkey is the constant increase in property prices, which is mainly driven by the continuous foreign demand for properties in the country. This demand has helped to create a thriving and dynamic real estate market in Turkey, offering many opportunities for investors and buyers alike.
5. Property prices in Turkey are cheaper compared to Europe
Investing in real estate in Turkey is a smart decision for those looking for affordable prices without compromising on quality. The Turkish real estate market boasts a diverse range of properties to suit every budget and preference.
In addition, Turkey’s strategic location and modern infrastructure make it an attractive destination for investment, with many facilities and incentives to support the growth of the real estate sector.
Moreover, Turkey’s unique blend of culture, history, and natural beauty is another compelling reason to consider investing in its real estate market. The country enjoys a Mediterranean climate, a booming economy, and a vibrant tourism industry. With so much to offer, Turkey is a profitable and ideal option for those seeking to invest and live in a beautiful and promising country.
6. Tax advantages for foreign investors
The Turkish government values foreign investment and strives to facilitate investment opportunities by providing various incentives. One such incentive is the exemption of value-added tax (VAT) for foreign investors who do not reside in Turkey.
Typically, VAT in Turkey ranges between 1% to 18% of the property’s sale price. However, foreign investors can take advantage of the tax exemption, leading to significant savings when investing in real estate in Turkey. This tax exemption is an effective tool used by the government to revitalize the local economy and attract more foreign investments.
The government has made several decisions that specifically target the real estate sector, which have positively impacted foreign investors’ motivation to acquire more property. These decisions have helped stimulate growth in the real estate market and contribute to its overall revival. With such facilities and incentives, investing in real estate in Turkey can prove to be a lucrative opportunity for foreign investors.
Can real estate investment in Turkey withstand inflation?
When it comes to inflation’s impact on real estate investment in Turkey, it can have adverse effects on the local consumer price index, which is reliant on the Turkish domestic market. However, foreign investors dealing with currencies other than the Turkish lira may not be as affected by inflation’s high rate when purchasing or renting real estate in Turkey.
In some cases, high inflation may even be beneficial to them as it could result in buying and renting real estate at a lower cost compared to their foreign currencies.
How have investors in the real estate sector been affected by the Turkish lira crisis?
Despite the decline in the value of the Turkish lira, experts believe that it does not necessarily indicate a weak economy as the Turkish economy is based on three main sectors: industry, trade, and real estate.
These sectors have demonstrated robust performance in their respective indicators, particularly the Turkish industry, which exports to 126 countries worldwide and has recorded $200 billion annually in the latest official statistics.
As a result, the decline in the Turkish lira’s value has not hindered the rising real estate prices due to the surge in foreign investor demand, taking advantage of the currency depreciation. This increase in demand reduces supply, which leads to a surge in prices, boosting the Turkish real estate market’s ability to maintain its market values.
In conclusion, Turkey’s real estate market has experienced significant growth over the years, with the country selling a staggering 1.5 million properties in 2021 alone, topping all other European countries. The country’s strategic location, stable economy, and robust investment opportunities make it an ideal location for real estate investment.
The advantages of real estate investment in Turkey include increasing returns on investment over time, the option to obtain Turkish citizenship, government support for the real estate sector, a market full of promising and rewarding opportunities, and competitive pricing.
The Turkish real estate market has a multitude of options for commercial and residential properties and is an excellent destination for investment. Investors should seek professional advice from companies like Move 2 Turkey to ensure a sound investment and make informed decisions.