Real Estate in Turkey (by Semiha Unal)

Istanbul, a giant city with historical and cultural resources and enormous business opportunities is challenging world giants such as Moscow, Paris, London, Tokyo, New York and many more. Istanbul was described as the most promising place for real estate investments in 2012.

The number of modern shopping centers increased from 44 to 284 between 2000 and 2011.Turkey, as a regional hub providing easy access to 1.5 billion consumers in Europe, the CIS, and as an energy corridor and terminal between Europe, Central Asia and the Middle East, creates more and more enterprises each year within its borders. 60 percent of Turkey’s population is under the age of 34, while the country’s GDP was $ 772 billion in 2011. Housing loans increased from TRY 3.5 billion in 2004 to TRY 68 billion as of September 2011. The share of housing loans as a proportion of Turkey’s GDP is estimated to hit 15 percent in 2015

Different surveys and publications such as the “Emerging Trends in Real Estate Europe”, prepared jointly by PricewaterhouseCoopers (PWC) and the Urban Land Institute (ULI), show how global and local interest in the Turkish real estate sector has increased. According to the 2012 publication of the report, Istanbul is ranked as the most attractive investment market in Europe in the “Existing Property Performance”, “New Property Acquisitions”, and “Development Prospects” categories, followed by Munich, Warsaw, Berlin, and Stockholm. Meanwhile, Turkey ranks as the 3rd most attractive real estate investment destination among the emerging countries in 2012, according to a survey conducted by the Association of Foreign Investors in Real Estate (AFIRE).

As Turkey progresses along the road to EU membership, the essential legislative reforms introduced have made investing in the real estate market even easier and more profitable.Turkey’s Parliament recently has approved a law that eases restrictions on the sale of land and real estate to foreign citizens.

The Turkish Minister of Environment and Urban Affairs said at the sidelines of a conference he attended in Istanbul. 
“Turkey offers an excellent investment location for foreigners. The new legislation will make obtaining property easier with the lifting of the reciprocity principle. Citizens of other countries will be able to buy any kind of property, including homes and office space,”

The limits to a piece of land that a foreign national can possess will be extended considerably as well, the Minister remarked, saying that the 2.5 hectare limit (25,000 square meters) will be raised to 30 hectares (300,000 square meters). The draft law calls for the lifting of the reciprocity protocol which bars citizens of 89 countries from owning a property in Turkey as Turkish nationals are not entitled to do the same in the prospective buyer’s country of origin. 

Property sales to foreigners in Turkey reached USD 2.5 billion in 2010. Enabling citizens of certain countries to obtain realty can easily double that figure, industry analysts say.

The amendments to the Land Registry Law, the Mortgage Law, and the redrafting of tax laws are also designed to improve the competitiveness of the Turkish real estate sector.

The sound banking, strong construction firms with a good reputation worldwide and an ongoing high demand and need for housing and especially for residences and plaza buildings are factors that give boost to the sector as well.

by SEMIHA UNAL
Business Consultant for Turkey
www.s4u-tr.com

Sources:

http://www.hurriyetdailynews.com/code-lets-foreigners-buy-more-local-land-in-turkey.aspx?pageID=238&nid=20024

http://www.invest.gov.tr/EN-US/SECTORS/Pages/RealEstate.aspx

Artikel van een Turkije correspondent over vastgoedmarkt in Turkije

http://www.turkijecorrespondent.nl/2012/08/14/turkse-panden-lucratief/