Feb 5, 2023

Turkey Real Estate: Advantages and Disadvantages

In general, the best type of investment in Turkey is investing in Turkey real estate. This type of investment has many positives and benefits and occupies the interest of investors as it brings them high profits. Yet, for this type of investment, there are many things that must be taken into consideration for the investment to be successful and to make a huge return.

Investment must also be a double-edged sword. Risk has a price and sacrifice has a price as well. It is certain that whoever seeks profit must cross the path of loss, but the percentage of loss in Turkey real estate is low, because it is the ideal choice for anyone who wants to invest and take risks in Turkey. The city of Istanbul in particular has a diversified risk investment; the more risk increases the more returns increase, which is the rule of any type of investment.

As we mentioned previously, the percentage of loss may be small compared to many investments, in which investors may lose most of what they own in moments. In addition, Turkey real estate is considered a visible asset that can be owned, not something virtual, and this characteristic makes the risks small, no matter how low Turkey real estate prices are in certain periods, it will definitely rise again.

Advantages of investing in Turkey Real estate

Every investment has many advantages that attract investors towards it and make capital flow. There is no doubt that real estate generates income on a steady basis and has always been known for its importance as assets characterized by many attractive factors, the most important of which are high returns and the possibility of obtaining financing. Yet, in exchange for the advantages, there are many negatives that must be delved into, known, and treated as risks in the distant future that may occur as a kind of precaution. We will summarize the positives of investing in Turkey real estate, in general, and investing in Istanbul real estate, in particular, with several points, the most important of which are:

Increasing the value of the properties you own in a short-term which means that the value of the property you own will certainly rise and thus your capital will increase, within few years.
Obtaining a fixed, continuous, guaranteed monthly financial return that can increase in the coming years.
Real estate investment in Istanbul is a safe investment. This type of long-term investment is known as a wonderful savings for the retirement period and a guarantee for a decent life.
There is a large and continuous demand for the rental market, whether the property is new or old, which guarantees a stable additional income.
Obtaining Turkish citizenship:

By buying one real estate property or a number of Turkey real estate with a value of 400 thousand US dollars. This advantage is definitely considered the best one after especially with the facilities that the Turkish government made including allowing the partner and children under 18 to obtain the Turkish citizenship with the investor. Moreover, there aren't any restrictions regarding the type of the property whether it is an apartment, an office, a villa, or a commercial store.

The Turkish government has demonstrated very great effectiveness in this particular matter, as a large and broad category of investors obtained Turkish citizenship within 90 days after completing the purchase process and receiving the title deed. This encourages many foreign investors to engage in real estate investment, in Istanbul in particular and Turkey in general, especially that the Turkish economy is rapidly growing and the real estate market is witnessing a recovery and very high demand, according to statistics conducted on a monthly basis.

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Disadvantages of investing in Turkey Real estate

Investing in Turkey real estate, like any type of investment, has negative aspects or some defects, but it must be noted that all of the defects mentioned below can be avoided if you consulted real estate companies specializing in Turkey real estate:

Sometimes the negatives or obstacles may not be related to you or your type of investment or decisions, but in many cases they will relate to the tenants. It is possible that the tenant will stop paying his/her monthly rent or be late in paying the value of the monthly allowance for the property, as delay and non-payment are considered among the main risks to you as an investor.
Be patient with the profits that generate in the long-term. This type of investment in Turkey real estate requires a lot of patience, because the returns are not immediate or close, so whoever wants to enter this field must be aware that profit here is based on patience. Usually, capital gains in this type of investment are long-term.
This kind of investment sometimes is affected by general economic conditions, which may make the investment property vacant at times.
The difficulty of finding tenants is sometimes one of the drawbacks of this type of real estate investment. To clarify, we have included this factor as a precaution, as there is no difficulty in finding a tenant for the property in Turkey, as long as it has a good location.
You may find it difficult to sell the property because the demand for commercial real estate in Turkey, whether for purchase or ownership, is not as intense as investment in residential real estate.

The impact of the New Istanbul Canal on Turkey Real estate

The New Istanbul Canal is a waterway that connects the Black Sea to the Sea of Marmara, as well as the Aegean and Mediterranean seas. The canal will cut through the European side of Istanbul, thus forming an island between the continents of Asia and Europe. The project includes the construction of ports, bridges, logistics centers and three artificial islands to complement the needs of the canal.

The benefits of the project on Turkey Real estate

After a number of studies carried out by Turkish and European researchers, the New Istanbul Canal project has proven its many benefits to the environment and the city of Istanbul. In this paragraph, we will talk about the economic benefits in all their aspects, especially in terms of their impact on Turkey real estate:

New tourist areas:

Through this project, the Turkish government seeks to transform the Bosphorus Strait into a new tourist area. This region is essentially the focus of attention of the world, tourists and residents of Istanbul due to the beauty of its nature and the monuments it contains. After the construction of the canal, the surrounding area will include large and huge resorts and commercial and entertainment centers.

Development of the Turkish economy

The New Istanbul Canal project works to enhance Turkey's economic strength. Turkey is expected to earn about $10 billion annually from the new canal. The region will also witness a major transformation due to the huge projects that will be built by Turkish and foreign investors and businessmen. As for the global aspect, the competition will be intense because the new canal aims to transport trade between China and Europe from the southern axis, which will increase Turkey’s ability to attract international trade, and thus the city of Istanbul will actually transform into a global center for international trade in the near future. In addition, studies on the project showed the employment of approximately 8-10 thousand people during the construction phase of the project, and 500-800 during the operation phase, which will contribute to reducing the unemployment rate in the country.

Enhancing the real estate market:

The largest share of the benefits of this project will be for the Turkey real estate market because the real estate that will be built near the canal will be a high and very profitable investment opportunity because Turkey real estate prices in the project area will be increasingly high. The start of digging the canal in 2017 led to construction companies in Turkey competing to build large projects near the new canal, which led to an increase in the price of real estate in those areas by 50% within one year. It is expected that real estate prices in these and neighboring areas will double upon the completion of the canal's construction. These areas are:

Ispartakule District.
Kucukcekmece District.
Avcılar District.
Arnavutkoy District.

If you want to know more about investing in Turkey real estate, do not hesitate to contact us via WhatsApp, here. Our real estate consultant will contact you as soon as possible.

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