Turkey’s in the ranking investment real estate ranks 14th in the world. The diversity of nations that buy real estate in Turkey, which is leaving behind countries such as Spain, Greece, and Portugal, is also increasing every year. According to research by an international investment company based in the United States, Turkey took place in the 14th rank in the “best real estate market for foreigners” ranking worldwide. Turkey has taken its place at the forefront of the global market with the cost of living, transaction cost, growth rate, and tourist attraction.

Real estate investment is one of the most profitable and safe types of investments in the world. Fixed assets such as land, houses, and apartments increase in value over time, in addition to the fact that real estate is not affected by market fluctuations as happens in stocks, and supply and demand do not stop in it, due to the permanent human need for housing and stability.

Real estate investment in Turkey is one of the best and most profitable types of investments, which attracted the attention of investors from all over the world, due to several reasons, including the high-profit returns and the rental guarantee offered by most residential and investment projects in Turkey, and the cheap real estate prices in Turkey compared to Dubai and European countries, and the advantages granted by the Turkish government to investors from the possibility of obtaining Turkish citizenship, real estate residence and other facilities and incentives that no other country in the world offers.

Types of real estate investment in Turkey

Real estate investment has several forms and types that differ according to the investor’s goal and the profit he is looking to achieve. These types are as follows:

1- Investment by buying residential real estate or hotel apartments, and then reselling or renting them and ensuring a stable profit in the long term, such as buying studio apartments in a residential project located near universities, schools, and public transportation and renting them to students, or buying an apartment in the city center near the business centers, or a villa in the coastal areas overlooking the sea, such as Beylikduzu and Buyukcekmece, and renting it to families during the seasons of tourism and holidays.

Another form of real estate investment is to buy an apartment in a project under construction at a cheap price and then resell it after the project is completed and the price of the apartment rises.

The first option differs from the second in that the first guarantees the investor a profit and a fixed monthly return, while the second is more suitable for those who want quick and urgent profits.

2- Investment by buying shops and offices, either to license it and practice a commercial activity in it or to rent it or resell it later, taking into account the selection of the appropriate location for the shop or office, to be within a vital area near the city center and the markets.

How to Choose a Real Estate Investment? 

There are a few things to think about before an individual starts the process of investing in properties in Turkey. The stages of selecting a real estate market include initially deciding on a city and then locating the ideal area in which to purchase a house. Many of the finest areas to invest in share the same traits.

According to the growing regional market of real estate market, it will be simpler for an investor to select a convenient option in such a place where he/she may rent or sell the apartment. Factors that should be considered while investing in Istanbul real estate are:

Rental Returns

In Turkey, rental units are a common type of investment in real estate. Real estate is a reliable source of consistent income, with rental income ranging from 8 to 11 percent compared to 2-4 percent for residential real estate. Commercial real estate management is cheaper and easier than residential property management. This needs less administration because these assets are cared for by experienced project maintenance companies.

A further advantage is that the landlords don’t get to spend money on renovating the property because the renters would furnish it according to their preferences and needs. Short-term rentals are favored for residential property, whereas a 3+3+3-year contract with a preset rent increase is negotiated for commercial property.

Financing

Before investing in a property in Turkey, the investor should be aware of the budget and how much he/she is prepared to invest in a property.

Financial institutions in Turkey provide mortgages for real estate investment, however, the conditions and rates vary depending on the property type. Banks make it simpler to obtain funds for a residential property that is worth at least 90% of the property’s value. Credits for commercial property, on the other hand, are significantly more difficult to obtain, and only 60% of the property value is guaranteed.

The interest rate is substantially higher and is only appropriate for an investor if there are sufficient funds available. Still, if an investor has a limited amount of money, it should be better to invest in residential real estate.

Re-Selling the Property

Selecting the ideal investor is a time-consuming and difficult process when leaving or disposing of real estate holdings. If an investor has invested in a commercial property in a certain industry, the economic situation will have a big impact on the commercial property. And whenever the market will be slowed down, it might be difficult to locate a purchaser and sell the property.

An investor may even have to make certain concessions, such as on rent. In contrast to the residential unit, there is one potential with commercial real estate: it may be sold partially

Rental demand

Evaluating the market is essential for real estate investing in Turkey, as it is in every sector. It is critical to ensure that an investor targets a market with consistently rising rental demand, also, it should be understood by the target audience if we do not want to halt cash flows.

When assessing real estate rental requirements, turnover rates, days on the market, population increase, and the number of rental properties vs. current inventories must all be considered.

Exchange Rate

If you wish to make a real estate investment in Turkey, you need also to consider the growth and fall of the Turkish Lira. The exchange rate between foreign currency and the Turkish Lira will mostly benefit the investor’s purchase.

When trading in the Turkish lira in return for the investor’s money, time is critical since the Turkish currency has dropped 30% of its value in a year, giving indirectly a 30% discount. As a result, investing in Turkish real estate is crucial while the Turkish Lira is low.

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