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10.03.2024

TURKEY: a new financial policy

The content of the article:

  • Instability in the Turkish real estate market
  • Profitable investment = the purpose of the purchase
  • Real estate for rent: changes in legislation 
  • Which city to choose

 

Just a couple of years ago, Turkiye was considered one of the most profitable options for buying a home. Many Russian citizens rushed to invest in Turkish real estate, as compared to EU countries, a residence permit could be obtained for a fairly acceptable investment. Real estate prices were affordable, and the choice was also quite diverse. But in 2 years the situation has changed. Rising inflation, the unstable situation in the world and the large flow of emigrants to the country led to a significant jump in real estate prices. The financial policy within the state has also changed. Before the latest changes in legislation, a residence permit in Turkey could be obtained when buying real estate in small towns at a cadastral value of at least $ 50,000 and when buying in metropolitan cities at a cadastral value of at least $ 75,000. Now this threshold has been raised to $200,000. Regarding obtaining Turkish Citizenship in 2023, this threshold was increased to $ 400,000 and according to the latest reports from the authorities, it is planned to raise it to $ 600,000 in 2024.

In addition, refinancing interest rates have been increased. As of January 2024, the rate reached 45%, which affected the cost of lending, making mortgage loans practically unaffordable. As a result of such changes, the demand for real estate among foreigners began to decline and, according to forecasts, real estate prices were expected to fall sharply. However, these forecasts did not come true. 

Despite the decline in those wishing to invest in Turkish real estate, this is still a period for many investors that makes it possible to find an object at a favorable price, which will subsequently increase initial investments. And here it is important not to rush, but to systematically study all the offers on the market.          

After the devastating earthquake (in early 2023) in the eastern provinces of the country, demand increased even more for houses and apartments in large cities that remained intact: Istanbul, Antalya, Alanya, Ankara. Resort-type cities have also remained popular: Belek, Kemer, Bodrum, Side. But before deciding to buy a home in these areas, you need to figure out: why do you want to buy real estate here? 

  • to obtain a residence permit, citizenship
  • for seasonal holidays
  • rental business and profit

 

As soon as the goal is determined, a search is underway the right location, because everyone's needs are different here. Large cities are unlikely to be suitable for a quiet and peaceful life, because there are busy and noisy streets. And in resort towns, you will not be able to relax in silence on the first coastline either. But for renting out, this is just the right accommodation, since for many tourists the main criterion remains proximity to the sea. Real estate is also relevant in those areas where employees in the service sector speak Russian well. 

Today, the request for the purchase of real estate in Turkey in order to obtain Citizenship is still relevant. Despite the tightening of the rules for submitting documents, the Turkish passport remains one of the fastest in terms of execution and is issued through investing in real estate. It is also attractive that after 3 years of ownership of the property, you can return your investment by selling the property without losing the right to citizenship.

If your plans for real estate are a vacation near the sea, then consider Alanya as an option. It is beautiful in its diversity and is suitable for absolutely everyone. For lovers of an active lifestyle, it is recommended to buy houses and apartments closer to the sea. But for a calm and quiet environment, it is better to live in the upper part of the city. Alanya is constantly developing: New residential complexes, shopping and entertainment centers are being built. It is also attractive that many residents of the city speak Russian well enough, and this will greatly facilitate your adaptation. 

If you plan to rent a house, then your task is to focus on potential customers and act within the framework of Turkish legislation. According to the latest changes in the rental law, investors will not be able to rent out their homes on their own for less than 100 days, as it was before. They will have to go through a number of procedures, including obtaining the appropriate license. It will be difficult to do this individually, as you can get large fines. Therefore, here we can recommend buying real estate from those developers who have their own management company and can take control of your facility. Or buy an object for rental income, which is managed by hotels.

The income will also depend on the location of your property.For those who like it to be noisy, fun and bright, cities such as Istanbul, Antalya, Kemer are suitable. And for those who prefer to live in a more measured way, learning the culture and traditions of the Turkish people, cities such as Ankara, Bursa, Alanya, Izmir are preferable. 

The beach season is ahead, so Turkey is more relevant than ever. And we are ready to provide support and support to our clients from the beginning to the full completion of the transaction.       

View investment properties in Turkiye.

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