International buyer growth predicted in Turkey
New home prices in Turkey increased by just over 12% in 2012 as more people become interested in buying in the country.
As well as domestic buyers, an increasing number of international buyers are seeing the new build sector as a buy to let investment.
Research from GYODER, the association of real estate investment companies in Turkey, shows sustained growth over the past five years and a Turkey property investment briefing hosted by Aberdeen Asset Management called the Turkish market mature and stable. Speaking at the event Herman Kok, the international research director at Multi Corporation, said that Turkey used to have a inflationary economy that was regarded as volatile but that has now been left behind.
‘Since 2002 the Turkish government has created a stable platform for the economy,’ he said, adding that it also got a grip on both inflation and debt with public sector debt 40% of GDP compared to 100% previously and significantly lower than both Germany and France.
A report issued by PWC and the Urban Land Institute at the beginning of 2012 ranked Istanbul as the top city in the world in terms of investment and development and Fitch recently upgraded Turkey to Investment Grade.
GYODER estimates that overseas investment in the Turkish property market is set to rise from the current $2.5 billion a year to around $10 billion per annum.
‘We have seen international interest in buying coastal villas, flats and apartments in well known resort areas. This demand continues and has been strengthened by the recent revisions to Turkish property law abolishing the reciprocity rule and giving access to buyers from new countries including those in the Middle East and Russia,’ said Bilfer Budak Roche of Leggett Turkey real estate agency.
‘We have also seen an increase in demand for more commercial style projects including hotels, developments and investment property. This means that we have been busy extending our property portfolio which now includes some excellent opportunities for developers and investors,’ he explained.
One area the firm is tipping as good investment in 2013 is the purchase of prime land. ‘Many of the best sites have been snapped up and it’s becoming harder to find suitable plots, this is where local knowledge really comes to the fore,’ he said.
An example is a 26,904 square meter building plot on the coast near Kas suitable for a hotel or other tourist project on the market for around €3.8 million. Another plot in Istanbul suitable for a hotel with sea views and full planning permission is on the market at €23 million.
‘We fully expect to see demand from international buyers to continue growing in 2013. The key to buying wisely is to find an agent that combines both local market knowledge and international expertise and to let them guide you through the process,’ added Roche.