Hello
I’ve just done a search on this forum for posts about investing in Turkey but can’t find a lot, and in fact nothing much at all since 2004. Does anyone have any experience here.
My partner is Turkish and after spending some time in Turkey and looking at his IPs I became really interested in investing there myself. Unfortunately, according to my partner, Turkey does not really have a mortgage type system in place like we use in Australia (however apparently the banks are attempting to introduce such things) so I’m limited in my options….
However I still see possibilities. Property is inexpensive and building costs, materials, labour etc is cheap. Also, the government has recently introduced a type of first home owner incentive. I don’t know exact details but it’s something like a 30 year loan for the deposit on a home. I know there are companies who “recruit” first home owners and then start developing using this money. They then continue the development stage by stage with the home owner’s small ongoing periodic payments. This way development can take many years. My partner’s father works for such a company.
Since people really seem to be encouraged to take advantage of this government incentive, developers could stand to make a lot of money. I could imagine that a developer with available cash to develop these properties upfront could build much more quickly and then start earning income much more quickly… I wonder if there is some way I could get in on this type of venture… Maybe my partner, his father, another money partner and I could start a company like this….
I know I have been a bit vague and I definitely need to find out more specifics. But for now I’m just brainstorming outloud and was hoping for some thoughts and comments from you.
Negotiations in regard to Turkey joining the EU are going on right now with what I belive to be a good chance of Turkey joining (not that I know much at all….). History shows that along with everything else, property values will most likely rise once this happens. Do you agree? For this reason it may be a good time to invest in Turkey.
I’m going to generously assume that you are not spamming the site to drum up business.
That said, anyone investing in a country where they can’t speak the language and don’t know the law will get everything they deserve – no money, no property, huge debt and possibly a criminal record as well. I have ugly examples.
If Turkey largely runs on Islamic principles, then mortgages may be illegal. If they are, you can expect no property boom anytime soon. Finally, the foreign investment rules often catch people out- Australia’s are a case in point, but other countries can be much worse.
Big heaps of caution, OK?
Hi Quiggles
I’m new to PI and I’m considering Turkey mostly because I love the country and especially the people [fez][fez][fez]. Also my partner’s Turkish and I hope to spend a lot of time there. This email was a summary of my limited knowledge about my understanding of investing in Turkey and a request for information and advice to anyone experienced in the area. From my message I don’t understand why you would think I was spamming the site.. [eh] Anyway not to worry.
To respond to your reply. As far as I’ve been able to find out mortgages are not illegal, apparently in the past people were simply unwilling to trust in the banks due to the instability of the economic climate etc. Things are changing. I know of at least one member of this site – Schwalel – who seems to have had some success in investment in Turkey. Shwalel, if you’re out there, please give us some advice. Also Skippygirl and Pelican mentioned on this forum that they were going to check out Turkey for investment opportunites in 2004-2005. I wonder what they came up with……
Hi Noysee,
I can’t help you with your Q – though my wife and I travelled for 2 mths in Turkey (and loved it – one of our favourite places in the world. Largely because the people are so wonderful – you’re lucky to be married to one!) we weren’t looking for properties.
But I just did a member search for the members you referred to, and shwalel doesn’t exist anymore, but Skippygirl and Pelican are both in the records. You could try sending them a PM and see if they reply??? Worth giving it a go at any rate…
If you don’t know how to do a member search, just drop me a line.
Best of luck!
Adam
Don’t let life get in the way of living.
Hello Adam
I work on a cruise ship which has afforded me the opportunity to see a lot of countries and like you, Turkey is one of my favourites for the same reason as you mentioned. I found the Turkish to be generally the most genuinely hospitable, open and welcoming people I’ve met anywhere! I also love the variety of the landscape within the country.
I’ve have sent messages to both Pelican and Skippygirl but haven’t received a reply as yet…. [glum]
Thanks again Adam and take care and be well.
I must qualify my statement – Turkish people are the SECOND most wonderful people in the world, after Canadians (otherwise my lovely Canadian wife might get upset!)!!![tongue]
Don’t let life get in the way of living.
Hi There,
My first input to the forum. So, hello all and thanks to the team managing and maintaining the site. Keep up the good work.I am Turkish, so I thought I might give you guys a background.
Originally posted by quiggles:
If Turkey largely runs on Islamic principles, then mortgages may be illegal. If they are, you can expect no property boom anytime soon. Finally, the foreign investment rules often catch people out- Australia’s are a case in point, but other countries can be much worse.
Big heaps of caution, OK?Turkey doesn’t run with Islamic rules. It is democratic country. Religion and Government is totally separated.
Mortgages not illegal, nor the interest.
There are rules around how much property can be purchased if the buyer is overseas person/company. It is specified in sqm.
Currently there is no mortgage system in Turkey. The reason for this was the high interest rates which used to be up to %70 for years. Current interest rate is around %20, hence the most affordable it has ever been for a while. As a result there is a lot of talk around introduction of Mortgage System. Government is setting up for this currently. It will be great opportunity for a lot of people. As the rate of house owners are really low compared to Australia. However, I believe it is still too early for Mortgage introduction and this may financially ruin a lot of people, as people don’t realise how much they have to pay back with %20 interest for 25 years. They just think that it is the cheapest they have ever seen during last decade, so it should be great.
Currently, you can get a house loan from Turkish banks, but only 5-10 years max. Repayments are really high as a result. And you cant sell the house before paying it off.
I was in Turkey 6 months ago and actively searching for investment properties.
It seems that 2004 was the golden year for the realestate market.
1999 earthquake and financial crisis after affected the RE market deeply. Properties were selling for peanuts. I am talking well under $100k.
All positive cashflow.
2004 was the boom and still booming. I would say max 1 more year to go. RE prices have been more then doubled, some tripled.
When I was there I have seen great returns.
Positive cash flow are easy to find. Commercial property market is unbelievable. I have seen up to %25 net returns.
There are other factor needs to be aware of that Australians not used to. Such as most of the buildings are high rise in Turkey. As a result, you need to be aware of the owning rights on the total title. Earthquakes shake Turkey all the time, building standards are very important and looked at buy educated buyers. Purchasing system is different. Different taxation rules.
There are great positive sides of investing Turkey as well.
– People renting the house pays for any water, elect, body corp fees, etc… As a result received rental return is almost net income.
– Rental demand is incredibly high. There are people ready to pay 6mnts-1year in advance.
– Stamp duty is around %1, and half of that paid by the house owner.
– Government lets you claim a set amount (which is really high) for repairs without any receipts.
– House owners keeps the bond, which might be up to 3 months worth of rent, so you can invest this anywhere else
– Single male rental market is ready to pay a lot more extra.I have also seen a lot more building opportunities. There are heaps of half built house/apartments around, which might be a great opportunity to finish. For eg, I have seen 3 villas in one of the famous summer holiday places. they were all built, however outside needed to be rendered, and full inside need to be finished. All these 3 villas were having magnificent see view. The next door was also selling which was about 10 years old lovely looking finished villa for $135k. And guess what the owner of the 3 villa was happy to sell the 3 for $120k.
Originally posted by quiggles:That said, anyone investing in a country where they can’t speak the language and don’t know the law will get everything they deserve – no money, no property, huge debt and possibly a criminal record as well. I have ugly examples.
I cant agree more. There is enough conman out there to rip you off to bond undies.
Finally, my intentions are not to spam or advertise anything. I am simply giving you guys information about my beautiful country.
Love you all.
Max Ungun
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