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Can a foreigner buy property in Turkey? This is a question we keep hearing in Singapore. Our friends, colleagues and neighbours in Singapore are eager to learn about the real estate market in Turkey.
Why are Singaporean investors interested in the Turkish real estate market? We should break this question into two: 1. Why in invest in Turkey? And 2. Why real estate?
1.Turkey is little known territory for Asian people. But there is interest growing towards Turkey as an exotic touristic destination that remains affordable. It is attractive because of its proximity to Europe yet it’s not Europe in a good way. Turkey is still an emerging market with a GDP growth of 8% in 2011, the highest among all European countries. According to Urban Land Institute analysis, Istanbul – the largest city in Turkey, is ranked the highest in Europe in terms of both investment opportunities and for city development prospects. The Turkish economy kept growing despite the European economic recession. Yes, there are uncertainties like in any developing countries but investors interested in emerging markets are willing to take the risk for high returns.
2.Until recently real estate has not been very foreigner friendly in Turkey. Reciprocity was the fundamental rule. If a Turkish citizen was not authorized to buy land or property in the country of the foreigner who was willing to purchase real estate in Turkey, the latter was not authorized either. There was a limit on the size of the land a foreigner could buy. All of these rules changed this May 17th. The new legislation abolishes the rule of reciprocity and lets all nationals buy real estate. The Arabs interested in spending their summer vacations in Turkey or making money by running hotels will have no restriction on investing in properties. The new law also increases the maximum size of real estate a foreigner could buy from 2.5 hectares to 30 hectares, which will give greater investment opportunities for commercial constructions. Ali Agaoglu, the chairman of Agaoglu Corporate Group – one of Turkey’s biggest construction companies, told the Turkish newspaper Sabah that he expected the new law to generate US$20 billion in revenue in the next two years, with his own company alone planning to sell apartments and houses worth US$2 billion. In sum, if you’re a foreigner looking for real estate investments, Turkey could be an attractive market right before an investment boom.
What about real estate loving Singaporeans? Well, if you ever visit Singapore, besides its orderly clean streets, branded shopping malls and tropical gardens, you will notice a few things: First, brand new buildings mostly high rises as residences, office towers, hotels and shopping malls. Second, on-going construction sites almost on every street. Singaporeans are always keen on investing their money on overpriced real estate with high monthly rentals.
There are a lot of wealthy investors in Singapore. According to a new study by Boston Consulting Group, 17.1 per cent of Singaporean households – more than one in six – are millionaires. Singaporean households with investable assets of US$1 million jumped 14 per cent more to 188,000 last year. In addition, real estate is a preferred investment among Singaporean retirees. A monthly rental replaces salary as one retires. Real estate is seen as a long-term investment, with low price volatility, steady income stream and well suited for wealth preservation for many generations.
If Singaporeans are content with their real estate investments in Singapore, why would they want to invest in Turkey?
– Diversify risks by investing in an emerging market
– Buy property for cheaper prices. Analysts predict that property prices are underpriced in Turkey today and will gain value tomorrow.
– Considering natural and historical beauties, houses and lands by the Mediterranean Sea are undervalued compared to its European alternatives.
– Cost of construction and maintenance is relatively inexpensive.
The only missing part is connecting Singaporean investors with Turkish landlords and construction companies.
Ela Erozan Gürsel writes a weekly column named “Değişim Yelpazesi ” on global business trends for Dünya Gazetesi on behalf of Datassist for almost two years. Her feature topics include: green energy; climate change; impacts of financial crisis on companies, sectors and regions; innovative technologies in sciences, human resources and management; social networks transforming business and politics; changing dynamics of marketing and branding.
She also writes articles for international magazines published in Singapore.
Prior to her writing career, she worked at Datassist as a Project Manager in a project that combines human resources and mobile communications with the aim to connect blue-collar workers and employers through mobile phones. Before engaging in this exciting project, she was in pharmaceutical sales working for a multinational company. She graduated from American University, Washington, DC, majoring in International Studies with a concentration on International Business and Europe. She worked in Washington D.C. as an Account Manager at a boutique telemarketing firm that specializes in fund raising and publication renewals. She speaks Turkish, English, French, and Spanish. She currently resides in Singapore with her husband.
All these projects are inspiring for artists, students and general public, who would like to be proud of the richness of the Turkish culture. For these cultural projects to last and prosper, museums need to be financially supported by the government agencies, private sector and international foundations. I hope Baksı Museum will keep up its creative projects with the help of professionals’ efforts and get the attention of potential sponsors in order to further contribute to the local economy and art.
