Should I Buy a Property Now in Turkey or Wait for the Elections?
As we know, the establishment of the Republic of Turkey was proclaimed on October 28, 1923, by the founder and first president, Mustafa Kemal Atatürk. Turkey is a state of law and a democratic state that is governed by the constitution and political pluralism and has witnessed a rotation of power since its establishment. It has also been through a state of political, economic, security and military stability, far from any problems or crises, for more than three decades. Moreover, Turkey will soon witness, particularly, in June 2023, presidential elections for choosing the 13th president of Turkey. The Justice and Development Party (AKP) and its candidate, the current president, Recep Tayyip Erdogan, who became president of Turkey in 2014, and the Republican People's Party (CHP), which has not yet announced its candidate, are among the most competitive parties in the upcoming presidential elections.
Real estate sales in Turkey 2022 and beyond
The real estate sector in Turkey is an important factor in the Turkish economy. Lately, in 2022, Turkish real estate sales are hitting records; from January to November 2022, house sales increased by 1.0% compared to the same period in the previous year to 1,277,659 houses. Istanbul had the highest share with 16.7% and 19,687 of the home sales. According to TURKSTAT, in November 2022, Russian citizens bought 2,575 homes in Turkey.
According to predictions and estimated statistics, the Turkish real estate market will be at its peak after 2023, due to the new strategic projects, that will be established in Istanbul, such as the New Istanbul Canal, which in turn will increase the demand for real estate in the surrounding areas, thus will increase its returns, which indicates that real estate prices will almost double.
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Will real estate sales in Turkey be affected by the 2023 presidential elections?
In general, elections are a democratic process through which the right person will be chosen for the right place, by people, through practicing their natural right. Therefore, in general, it cannot negatively affect the market or the economy of any country. Yet, what about Turkey? Turks and non-Turks are eagerly awaiting the Turkish presidential elections, as they mean a lot to them and to Turkey.
The elections that will take place in 2023 coincide with the end of the term of the Montreux Agreement, which limits the total tonnage of sea vessels of a country outside the Black Sea basin by 20,000 tons. It also coincides with the centennial celebration of the founding of the Turkish state, which is a year of achievements and opening of government development projects. This would drive investment in Turkey forward, affected by the movement of production, industry, and exports. Among the largest of these projects that will be opened is the new Istanbul Canal project, which will raise Turkey's political, economic and commercial status.
If we want to resolve the debate about real estate sales in Turkey after 2023, we will say that
There will be an increase in the real estate demand in Turkey, which in turn will increase its prices, as well, which is considered a great investment opportunity, especially if the investor wants a short-term investment with great returns.
Will property laws remain the same after the elections of 2023?
Foreign investment in Turkey is a factor of safety and development for it, especially from the economic side, which is still powerful and coherent despite the COVID-19 pandemic, the decline in the value of the Turkish lira, the increase in the inflation rate to about 80%, and the Russian-Ukrainian war. This economic cohesion is caused by the support for investment, exports, industry, and production. Therefore, the Turkish government will continue to support investment and investors on its lands, so, the winning of any of the candidate parties will not affect these laws, except that it may be accompanied by an increase in some prices, such as an increase in the price of the property that qualifies for obtaining Turkish citizenship, in addition to the increase in the price of the property that qualifies for permanent residence or real estate residence. .
Here we will stand for a while to reflect on what the CEO of Akarkom, Mr. Omar Farouk: "The best time to buy a property was yesterday."
Will Turkey continue to support foreign investors on its land?
We will talk first about the recent facilities that the Turkish government has made for foreign investors:
Issuing a real estate appraisal document to decrease fraud cases:
It means issuing a real estate appraisal document by which the purchasing process does not complete without obtaining it. It is usually required from specialized and licensed firms, through which the real value of the property is calculated according to the price per square meter in the area of the property, which eliminates any fraudulent idea.
Abolition of the reciprocity law in Turkey:
Turkey used to follow the law of "reciprocity" regarding real estate investment, which stipulates allowing foreigners coming from countries that allow Turkish citizens to invest on their lands to buy real estate in Turkey or invest in it, but after canceling this decision in 2012, citizens of 180 countries were allowed to own real estate and thus invest and operate the wheel of the Turkish economy.
Reducing and eliminating many taxes arising from buying real estate in Turkey:
Over the past years, the Turkish government has significantly reduced taxes on the purchase of Turkish real estate and investment by foreigners, whether in the tax imposed on the (title deed) or other taxes. It also set certain conditions for canceling the value-added tax on the property for foreign investors, so that the rate of the canceled tax in some areas reaches 18% of the value of the property. This made Turkey competitive in the real estate market compared to neighboring countries, whether in Europe or the Middle East.
Removing bureaucratic obstacles for foreign investors:
Like many countries, in Turkey, there is no difference in the laws and penalties resulting therefrom between a Turkish citizen and a foreigner, especially since the Turkish government always emphasizes the support of foreign investors on its territory in all ways and means.
Granting real estate and investment residencies:
Granting real estate and investment residencies is another type of government facilitation for foreign investors in the country.
Features and benefits of real estate residence:
- Legal residence in Turkey.
- The real estate owner's family; wife and children under 18 years old, are included within the real estate residency rights.
- The possibility of renewing the real estate residence permit with great ease.
- Freedom of movement between Turkish states.
- Access to educational services in Turkish schools and universities.
- Free or great discounts on health services in Turkish hospitals.
- If the value of the property is $400,000 or more, you can apply for Turkish citizenship.
Will the facilities for investment and real estate purchase in Turkey continue after 2023?
Answering this question requires good thinking! First, any country that works to develop its economy and stand by its people cannot stop foreign investment in its lands because of its great returns to the country's economy. However, if we study the Turkish economy in general, and the real estate market, in particular, we will notice that each of them is in great progress and in a state of prosperity that is on its way to the world. Therefore, there is a great demand on the Turkish real estate market, as the coming period will witness huge strategic projects that will have a significant impact on the international economy and international trade, on the other hand, especially after Turkish President Recep Tayyip Erdogan announced that Turkey will distribute natural gas coming from Russia to Europe through its territory, through " TurkStream", not to mention the recent discovery of Turkish gas fields, which will greatly draw attention to it, especially after the crisis that Europe is currently experiencing due to the Russian gas cutoff, which was the first indication of an incredibly increased demand for Turkish real estate. This leads us to the first theory of economics, which is that the higher the demand, the higher the price. Therefore, and logically, the government will raise the ceiling of real estate that qualifies for obtaining citizenship or real estate residency. This means that the right time to buy real estate in Turkey is, if not yesterday, then it is today. As for waiting, it will lead us to bigger numbers, which would bring great returns if they were invested earlier.
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