In a world where the economic landscape is constantly changing. Turkey continues to attract the attention of investors with its unique characteristics and income potential. Below we look at the key reasons why now is a great time to invest in Turkey and especially its real estate market.
1- An active real estate market that is not dependent on foreign investors.
From 2013 to 2023, the share of transactions with foreign investors did not exceed 4.5% (peaking in 2022) of total sales. The market has strong domestic support and shows healthy demand from the locals. This means that investments will be less susceptible to fluctuations caused by external factors or changes in the flow of international investment.
2- International rating agencies and major foreign investors are confident in the development and strengthening of Turkey’s economy.
International rating agency Fitch Ratings has improved the country’s GDP growth forecast for 2024 to 2.8% and expects an increase to 3.1% in 2025. Similarly, Moody’s anticipates Turkey’s economy to grow by 2.5% in 2024 and 3% in 2025.
Leading international investors are showing significant interest in investing in Turkey’s economy. Turkey and the UAE plan to increase trade turnover to $40 billion in five years, with the UAE already investing $5 billion and setting up a $10 billion fund for Turkey’s development. Alibaba Group Holding Ltd, a major e-commerce player from China, has also announced a $2 billion investment, having already invested $1.4 billion in Turkey through Trendyol.
3- The cost of real estate in Turkey is lower than in Europe.
It is important to take into account that even with the same budget, such indicators as the class of the object, the vastness of infrastructure in the complex, location and age of the house in Turkish real estate will be much more attractive than in Europe. Resort real estate in Turkey often has the infrastructure of a five-star hotel. Villas on the coast in Turkey are much cheaper than comparable real estate in EU countries.
4- Low tax burden when acquiring real estate.
In Turkey, the tax on the purchase of real estate is 4% of the cadastral value of the object, the annual tax – 0.1-0.6% depending on the type and location of the property. For comparison, in Spain, the transfer of ownership tax (ITP) for buyers of secondary housing ranges from 6% to 10%, depending on the region. For new buildings, an additional VAT (IVA) of 10% of the value of the property is charged. The annual property tax (IBI) varies from 0.4% to 1.1% of the cadastral value, depending on the municipality.
5- The procedure of investing in Turkish real estate attracts by the simplicity of the process.
As well as the minimum package of documents for the investor and the lack of requirements to disclose the source of origin of funds.
6- Passive income.
Investors can expect annual rental income from residential real estate in Turkey in the range of 5-10% depending on the location and popularity of the object. In coastal areas during the peak season, yields increase, while in less sought-after areas they may decrease.
7- Possibility to obtain residence permit and citizenship for buying real estate.
Turkey is one of the few countries where the purchase of real estate is an instrument of legalization. Entry threshold for residence permit by right of ownership – $200,000 cadastral value of the object. Entry threshold for obtaining Turkish citizenship for investment is $400,000 cadastral value of real estate (data for the first quarter of 2024). Among European countries, a similar program is available only in Malta, where the entry threshold is $690,000.
An attractive feature of the Turkish program is that investments in real estate to obtain citizenship are returnable. After 3 years, the property can be resold and earn on the stable-high growth in housing prices in Turkey.
Another undeniable advantage of the Republic of Turkey – the country’s neutrality in political matters and loyal attitude to investors from different countries.
8- Investments in Turkish real estate are profitable due to the high growth rate of housing prices in the country.
With global inflation, investing in real estate is the most effective way to preserve capital and its purchasing power.
For the period 2020-2023, real estate price growth in Turkey has exceeded the global average, with the commercial real estate sector showing significant growth from $208 billion to $300 billion – 44%.
The residential real estate sector in Turkey has shown a 109% year-on-year growth as of September 2023.
9- Mild climate and favorable geographical location.
The long tourist season made possible by the mild climate and the strategic location between Europe and Asia, which provides convenient logistics, make Turkey an ideal place to live, vacation and do business, attracting renters and tourists all year round.
10- Guaranteed annual vacations that cost far more than hotel vacations.
Owning a property on Turkey’s Mediterranean coast offers a family of four the opportunity to enjoy a longer and more cost-effective vacation than staying in a hotel.
For the amount spent by a family for 9 days in a four-star hotel before the start of the season (€5000), you can provide a varied and comfortable vacation in your own apartment for a month, with the possibility of increasing up to three months without loss of quality, thanks to access to the rich infrastructure of modern Turkish residential complexes (spa and fitness centers, sports courts, playgrounds, cinemas, etc.).
Vacation in your own apartment on the coast of Turkey is significantly superior to a short hotel vacation in both emotional and health aspects, providing a longer stay and the opportunity for full recovery.
Using your own vacation home not only reduces costs, but also opens up additional income opportunities through rentals in the off-season.
Contact us for additional advice and get more information. If you have any questions, call or write to us by phone: +90 549 681 8866 (WhatsApp, Viber, Telegram) or send a request by email [email protected]. Our company employees will be happy to help you.
We also recommend subscribing to our YouTube channel and Telegram channel. There is only relevant, useful and, most importantly, truthful information about Turkey.