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The Turkish economy is steaming ahead towards recovery, with a drastically improved outlook for its property markets, after a year of robust expansion in 2013.

Residential sale prices for existing homes increased 1.41% in Turkey overall during July 2014, with residential rents rising 1.17% in the same month.

Although the domestic property market still faces challenges and demand remains weak, the climate for foreign investors has improved significantly, with interest focusing mainly on apartments in resort areas.

Residential rental values increased the most in Antalya, the fastest-growing city in Turkey, perennially popular with tourists.  With property prices in the city rising by 0.46% in July this year and rental prices increasing by 1.69%,there are some interesting yields available for foreign investors looking for a property to rent out.

In terms of sales, ever-popular Istanbul achieved the highest price increases at 1.80% in July with Adana at 1.34%, Ankara 0.90% and Antalya 0.46%.

The Turkish property market has cooled down a little from the torrid pace over the last decade.  From 2012 to 2013, prices grew by almost 12% in the country overall, raising concerns that the market was overheating.

However, a slow-down is now evident although growth continues to be recorded. An official from Ernst & Young said: “The pace of growth has slowed down. The construction side continues to grow but the number of apartments sold has been decreasing for some consecutive months.”

Turkey’s housing market has now shown signs of stabilising and the threat of a bubble forming no longer hangs over the country’s head.  Several factors including new value-added tax laws and an anticipated economic cooling in 2014 means reduced domestic sales volume for both new and resale homes through the end of this year.

It is widely believed that foreign investors will pick up the slack in the domestic property market as transaction volumes have consistently risen over the last 18 months, showing no loss in investor sentiment for Turkey.

Real estate researchers Cushman & Wakefield recently published a very positive report on Turkey’s outlook based upon data collected over the first two quarters of the year, which said:

'Domestic demand is likely to fade into the background this year due to tight credit and high inflation.  However, conditions for consumer spending and investment are expected to improve in late 2014 and these two elements of the economy are expected to return to health in 2014.'

The general consensus is that long-term growth prospects for the Turkish economy are very bright, excellent news for those invested or considering investment in the country’s property.


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Rising property values, booming tourist numbers and ever improving air access is making Turkey more attractive to foreign real estate investors, it is claimed.

Turkey's attraction to foreign property buyers has gained momentum during the first half of 2014 with a promising second half ahead, according to a Turkish real estate agency.

Sales to foreigners in Turkey rose 60% year on year during the first six months of 2014, totalling 8,507 property purchases, according to figures from the Turkish Statistical Institute.


For the same period, Istanbul alone recorded a 150% increase in foreign buyers, putting it ahead of the tourist province of Antalya, home to the popular resorts of Alanya, Belek and Kalkan.

Meanwhile, the average price of a new Turkish home was 12.05% higher in June compared to June 2013. It was one of the strongest months for the Turkish property market with 600 foreign purchases in Istanbul, followed by Antalya at 586 and Aydin at 108.

The Turkish Ministry of Economy confirmed that foreigners bought $1.26 billion worth of Turkish real estate in the first four months of the year, which was $893million more than in the same period in 2013.

‘Istanbul has certainly been a winner for us this year. Interest has been strong from Middle Eastern buyers in particular, with most buying one or more buy to lets in the mushrooming suburbs of the city, such as Beylikduzu and Bahcesehir,’ said a property expert Tom Watkins.

Foreign visitors to Turkey increased by 3.24% year on year in the first three months of 2014, reaching 4.35 million, according to data from the Ministry of Tourism and Culture. The second quarter recorded even greater growth, up 6.8% year on year, peaking at 10.9 million. In terms of revenue, tourism generated a record high of $8.9 billion in the second quarter of 2014, a 7.9% increase over the same period last year.

Turkey welcomed more than 35 million foreign visitors in 2013, becoming the sixth most popular travel destination in the world, but is forecast to receive 43 million tourists in 2014, with the sector generating revenue of $36 billion.
‘Increased tourists not only stimulate the property market in terms of sales but they also are encouraging for foreign owners who let their property to holidaymakers,’ explained Walker.

This year has seen Turkey's global air links and air traffic continue to grow, with interest in the Middle East driving much of this. In June, a record 16 million passengers passed Turkish airports, while in May, Istanbul's Ataturk Airport broke a European record for the highest number of landings with 1,267, in any one day.

At Istanbul's second airport, Sabiha Gökçen, Turkey's Pegasus Airlines has make progress in 2014 to becoming the fourth largest low cost carrier in Europe. Results from the first quarter of this year showed the airline carried over four million annual passengers, growth of over 25%.

Meanwhile, in June, Turkey's flagship national carrier, Turkish Airlines, launched its 257th destination, cementing its position as one of the world's leading carriers.

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According to a latest report by Turkish Finance Ministry, the country’s property market continues to attract foreign investors. The report has been backed by the visible increase of 42 percent of purchases made by the investors during the first half of 2014. An investment of nearly $1.26 billion was made by foreign investors between January and April of 2014 in Turkey’s real estate market.

In other words, almost a quarter of the foreign investment, which has been growing year on year since 2012, has been concentrated on real estate markets in both urban and suburban locations. This amount has largely been contributed by investors from Gulf regions who generate nearly five percent of Turkey’s annual tourism revenue.

Investors from GCC region comprising of Qatar, Saudi Arabia, Oman, Bahrain and Kuwait have contributed to local tourism growth and also purchased property in large cities as well as peripheral regions, which have potential for growth.

With slowdown in property markets in Dubai and growing political unrest in the Middle East these investors are looking for stable markets to invest, which will yield good returns. So Turkey like the rest of Europe, remains an attractive option for them. Turkey’s government has also encouraged tourists and investors through the introduction of multiple flights and by providing an ambient investment policy to promote growth of real estate across its borders.

Turkey’s finance ministry recently shared reports about a breakup of investments made by foreign institutional investors. As per the said report, the contribution of GCC nations was at $893 million in 2013, but grew by a whopping $1.26 billion within the first quarter of 2014 due to change in governmental policy. Besides encouraging air-traffic between Middle East and Turkey, its local government modified property ownership laws to make it easy for foreign nationals and specifically, residents of Gulf nations to buy property in Turkey

Visitors from the region contributed nearly $32.3 billion to Turkey’s tourism industry during 2013. Property prices in Turkey remained buoyant for the fifteenth consecutive year, which have been growing at a constant rate of 4 percent every year.

Bodrum, Antalya gain investor interest

Though historical Istanbul is the preferred destination of tourists in Turkey, investors in real estate are moving to fast-growing suburbs in locations like Bodrum, Antalya and Bursa. Foreign buyers of properties in Turkey purchased nearly $3 billion worth of property in 2013, representing growth of 15 percent since 2012. The biggest contribution was made by Antalya with overseas buyers purchasing most property in this region, followed by Istanbul. This is because these locations are not on the itinerary of regular tourists to Turkey, so are less crowded and have been developed into luxury resorts for the wealthy.

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Turkey’s growing marine tourism sector is expected to boost interest in property in coastal resorts in 2014, thanks to a raft of world-class marinas, many of them less than a year or two old, attracting an increasing number of lifestyle property investors. 

Resorts with world-class marinas along Turkey’s pretty Aegean and Mediterranean coastlines have become property hot spots, not only for foreign investors but also members of Turkey’s rising affluent middle class, many of whom are based in Istanbul.

They can also compare very favourably with counterparts on the Cote D’Azur, Costa del Sol and Balearics in terms of mooring fees, as well as having shorter, or non-existent, waiting lists for berths.

Some of Turkey’s newest and most desirable marinas include Palmarina in Yalikavak-Bodrum, newly opened in June 2013, D-Marin Marinas in Göcek and Didim, the latter being Turkey’s largest marina, the Setur and Camper & Nicholson marinas in Çesme, and three further Setur marinas in Finike, Kas and Antalya.

Julian Walker, an overseas property expert is quoted in saying “Turkey’s upped its game in maritime tourism in recent years and we’re beginning to reap the rewards. That said, there’s more to come, as the Government has a target number of berths to hit before 2023.  

“Areas such as Bodrum and Göcek have become highly fashionable hang-outs for the world’s sailing jetset, who attract chic restaurants and boutique shopping, as well as higher property prices.

“Istanbul’s hosting of the World Marine Conference in June this year will raise awareness of Turkey’s world-class marinas even more.”

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Turkey's global reputation has not had a great couple of weeks.

The government's blocking of Twitter and YouTube, on the back of persistent whispers of internal corruption was followed by violence on the day of the Turkish local elections -  Sunday 30 March.

Yet things have calmed down since Prime Minister Erdogan's governing party obtained a clear victory at the elections - a major national test seen as clear proof of the continued support for his government.

Erdogan's AKP (Justice and Development Party) managed to win Istanbul and Ankara as the two most important cities in the country, the largest city - the business hub of Turkey and the capital respectively. 

So, what are the implications for Turkey - economically and politically?

Turkey's exports and general welfare have improved visibly under AKP.

Since assuming power in 2002, AKP has seen Turkey through several chapters of economic reforms, including major privatisations, strict monetary and fiscal policies that resulted in curbing inflation from over 80 per cent to around 8 per cent per annum and delivering up to 8.9 per cent year on year GDP growth in 2008 - 2013 periods.

From the inevitable collapse of 2001, that saw international companies wiping 45 per cent off their balance sheet valuations overnight, the Turkish Lira has come a long way in demonstrating a stable and strong currency for trade and international business.

It was not until mid 2013 that the scenario started changing. Turkish Lira started to slide against USD, same as most emerging market currencies, due to US tapering of its quantitative-easing programme implemented back in 2008.

As Russia, India and several other emerging markets recorded up to 35 per cent losses in May - August 2013 period, Turkish Lira proved yet again more stable and managed to hold at around 20 per cent drop.

Various allegations of wrong-doings against prominent figures in the Parliament signalled political instability to the international markets, causing stocks and currency to depreciate further.
     
“The above explains some of the reasons as to why these local elections were seen as far more important than just electing heads of constituents in Turkey,” says a local expert.

“The elections were more of a barometer as to continued popularity and general 'trust' in Erdogan and his ruling party, a barometer, which now a day after the elections, strongly signals continued support and hence political stability.”
   
On the morning of 31 March 2014, Turkish Lira opened against USD at 2.15, which is almost 5 per cent up on prior week. It appears Turks voted for continued prosperity.

“The result of the elections are actually far more positive than meet the eye,” suggests the expert, who also suggests there have been a fair few buyers waiting to see what happens on March 30th.
 
“Continued stability and development will see strong economic growth, which will undoubtedly increase domestic and foreign demand for quality housing in all parts of Turkey, pushing up property prices and presenting investors with exceptional gains.

“Average annual GDP growth expected in Turkey is almost three times that expected in the eurozone within next five years, therefore it is inevitable that compared to Euro zone Turkish real estate will be a clear winner for lifestyle and investment.  

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More people are likely to be investing in property in Turkey in the near future, according to predictions, thanks to the falling currency value in the nation. According to reports, the political turmoil that is currently in place in Turkey is likely to cause the value of the lira to fall significantly, something which will bring investors from other nations to the country to take advantage of property prices that are low comparatively.

Adil Yaman, director of Universal21, said: "As we saw in early 2013, unrest and political upheaval can result in a loss of confidence amongst overseas investors in the short term, such as the protests which took place in Gezi Park in early 2013." However, when currency value drops, those who live in nations where the value remains high can get more for their money, and this will see them looking to invest in properties in weaker economies.

At the moment, it is expected that those dealing in the pound, euro and dollar will look to get the most for their investment in Turkey, according to Universal21. This month, it said that the lira fell by as much as 6.3 per cent against the dollar, putting those from the US in a very strong position. Falls mean that price rises in Turkey over the past 12 months have been negated in certain currencies, making them cheaper than they were last year. The company said this means there has never been a better time to invest in property in Turkey.

"The uncertainty at the moment is likely to have an impact on short term investment in the country, however investors should remember that property investment is for the long term. The fundamentals for a strong and growing property market remain in place," Yaman added. A range of different factors make the country a favourable investment option, including the likes of the modernisation of existing housing stock, the transformation of urban areas and the multi-billion pound investment in transport and infrastructure.

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A series of new rules introduced this year will benefit expats and overseas homeowners in Turkey.

A raft of new rules governing property ownership in Turkey have made the country increasingly attractive to foreigners in 2013, laying the foundations for continued growth in the property market there in 2014, said Turkey property specialist Spot Blue International Property in November.

Turkey’s most recent law change favouring foreign buyers, which went live in October, facilitates the process of gaining military approval, which in turn speeds up the process of foreign buyers getting their property’s title deeds, known as TAPU.

This is the latest in a series of new rules introduced this year that benefit expats and overseas homeowners in Turkey.

“Previously, waiting for military approval could typically hold up a property purchase by 8-10 weeks,” said Spot Blue director Julian Walker. “Now, a slicker system means this time will be greatly reduced. Just as significant though, under some circumstances buyers won’t need to go through the process of getting military approval – namely, if the property they are buying was granted approval after 5th May 2011 or if they’re buying on a new development where an existing buyer has already gained it. It’s encouraging to see Turkey rolling out changes like this, showing commitment to attracting foreign buyers.”

Visa applications for temporary visitors, such as second homeowners, and residency laws have also become more appealing this year.

A revision in the law introduced in the spring means that foreign nationals are now granted a year-long short-term residency permit when they purchase property in Turkey, regardless of the value of the transaction.

This visa could be extended indefinitely if the buyer keeps hold of their property.

Previously, homeowners there without a residency permit were allowed to stay up to a total of 90 days out of a period of 180 consecutive days.

Adds Julian Walker: “Expats seeking to renew or get residence permits will find the process changes for the better again in spring 2014 too. There are plans to use dedicated government agencies to take over the process rather than the current system that goes through the police.

Another significant change is in regards to work permits. Meanwhile, foreigners who obtain a work permit in Turkey are now automatically granted a residence permit too.” In May 2012, Turkey relaxed its reciprocity law, opening the door to foreign buyers outside of Europe, including the Middle East.

Proof that Turkey’s property market is benefiting from changes to its laws are the consistently rising property values. The average price of units on new developments in Istanbul increased by 1.06 per cent between September and October, and 14.18 per cent year-on-year, according to an index produced by GYODER, a real estate trade body.

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Article Source: Fethiye Times

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New rules governing property ownership in Turkey have made the country increasingly attractive to foreign and laying the foundations for continued growth in the property market in 2014, it is claimed.

According to Turkey property specialist Spot Blue International Property, the country’s most recent law change favouring foreign buyers have made the process of getting title deeds known as TAPU faster.

It is just one in a series of changes designed to attract more foreign buyers. Previously waiting for approval for title deeds could have added up to 10 weeks to the time it takes to complete a purchase as buyers needed military approval.

‘Now a slicker system means this time will be greatly reduced and buyers won't need to go through the process of getting military approval,’ said Spot Blue director Julian Walker.

It means that if the property they are buying was granted approval after 05 May 2011 or if they're buying on a new development where an existing buyer has already gained it, the title deed process will be faster.‘It's encouraging to see Turkey rolling out changes like this, showing commitment to attracting foreign buyers,’ added Walker.

Visa applications for temporary visitors, such as second home owners, and residency laws have also been changed this year. A revision in the law introduced in the spring means that foreign nationals are now granted a year long short term residency permit when they buy property in Turkey, regardless of the value of the transaction.

This visa could be extended indefinitely if the buyer keeps hold of their property. Previously, home owners there without a residency permit were allowed to stay up to a total of 90 days out of a period of 180 consecutive days.

It is to get even better in 2014. ‘Expats seeking to renew or get residence permits will find the process changes for the better again in spring 2014. There are plans to use dedicated government agencies to take over the process rather than the current system that goes through the police,’ explained Walker.

Another significant change is in regards to work permits. Foreigners who obtain a work permit in Turkey are now automatically granted a residence permit. And more buyers have been encouraged by changes to Turkey’s reciprocity law which has opened the property market to buyers outside of Europe, including the Middle East and Russia.

Proof that Turkey's property market is benefiting from changes to its laws are the consistently rising property values. The average price of units on new developments in Istanbul increased by 1.06% between September and October, and 14.18% year on year, according to an index produced by GYODER, a real estate trade body.

Turkey’s economy and property market has outperformed the rest of Europe since 2010 when the country recovered quickly from what turned out to be a prolonged slump in most of the rest of Europe. Currency changes also currently favour some foreign buyers.

‘The good news for investors considering purchasing a property in Turkey is the combination of rising prices and the fact that buyers can now get more for their money,’ said Monica Anca, director of property firm Universal 21.

Most analysts are predicting that the Turkish currency is more likely to rise in value in the next 12 months than fall further with Bloomberg economists suggesting that Turkey offers some of the best growth prospects in emerging markets.

‘Turkey’s economic growth set to outpace the rest of Europe again next year, which means now is a very good time to consider investing in cities like Istanbul where property prices are still relatively affordable by western European standards and rising fast,’ said Adil Yaman managing director of Universal 21.

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Article source: PropertyWire

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Turkey has one of the most beautiful coastlines in the world blessed with over 320 days sunshine each year. Tourism is growing rapidly, properties are affordable and with Turkey enjoying the fastest economic growth in Europe, properties have resumed their upward trend and buyers are pouring in from all over the Middle East and Northern Europe. All in all, Turkey seems a top place for investment. Yet, despite the beautiful coastline of Turkey and the affordability of its holiday properties, the lengthy purchase process for foreigners has made life difficult for foreign buyers.

Until now, foreign nationals buying property or land in Turkey have had to apply for military clearance – a check to ensure that the land upon which the property sits is not located in a military zone.

This process can sometimes take 3 months, causing uncertainty, additional costs, and delays in mortgages as titles cannot be registered until clearance.

This has now changed. New government rules means that military clearance is now performed for the entire development site, rather than on individual properties. Once one property is cleared, all are cleared. This cuts the time it takes to obtain the title deed, known in Turkey as the TAPU, to just one day.

Turkey is internationally regarded as one of the most secure property markets in Europe with Turkey enjoying one of the lowest levels of indebtedness in the world.

This welcome amendment finally removes one of the biggest obstacles to foreign property ownership in Turkey. It would seems that the investment brakes are well and truly off.

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Article Source: Peter Mustafa, Managing Director of Propertiesabroad.com.

Istanbul’s property market shows no sign of cooling and the pace of growth has increased in recent months.

Both local and foreign investors are investing in real estate and in August the price of a new home in the city had risen by an average 2.66% in a month on the way to an overall 13.8% increase for the year.
 
Overseas property firms are saying that this is more than 1% higher than Turkey’s national average of approximately 12% in the same period.

‘For those investors who purchased property in 2010, the past three years have brought year on year increases of between 12 and 15%. There are few property markets in the world that could match this level of property price inflation.'

Prices are expected to continue rising. ‘We are seen an increasing number of investors from the Middle East arriving in Istanbul as a result of the market opening up to foreign investors more than a year ago.’

Previously it was difficult for investors from some countries to purchase property in Istanbul, however with restrictions eased this has helped fuel a second spell of double digit growth in the city.

Property prices in Istanbul have risen an average 41% since January 2010. Assuming that the current pace of property price increases is maintained Istanbul could well reach the 50% milestone within the next six months.

Studio and two bedroom apartments currently offer the best capital growth in Istanbul, as with most overseas property purchases foreign buyers in particular should do their homework before investing.

‘As with any city, investors should proceed with caution and make sure they know as much as possible about where they are investing, including the likely rental yield and demand in a particular area.’

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