“Don't wait to buy real estate. Buy real estate and wait.” Will Rogers.
Istanbul's cosmopolitan nature has resulted in a diverse community that attracts local and international investors. As the Istanbul real estate market has matured, various property types and investment opportunities are now available.
An overview of the real estate market in Istanbul
The real estate in Istanbul is one of the most dynamic and exciting in the world. The city is home to over 16 million people, and its population is expected to grow in the coming years. This strong demand for housing is driving up prices, but Istanbul still offers relatively affordable real estate compared to other major cities worldwide.
The city is also a popular tourist destination, and many foreign buyers are investing in real estate to generate income from short-term rentals. In recent years, the Turkish government has also made it easier for foreigners to buy properties there, further boosting demand and interest rates.
When looking for the best countries to invest in real estate development, Istanbul, in particular, and Turkey, in general, is one of the first results that will appear.
Turkey is a country that has local and global influence and is an essential member of the G20 group, as it is characterized by multiple economic factors and an important geopolitical position that makes it one of the best countries to invest in genuine estate investment.
Here is an overview of the critical trends in Istanbul real estate in 2023:
- Prices are rising but still affordable: The average price of a square meter residential property in Istanbul is around $2,000. However, prices vary depending on the location and type of property. For example, luxury apartments in the city center can cost upwards of $10,000 per square meter.
- Foreign buyers are active: Foreign buyers accounted for around 5% of all property sales in Istanbul in 2022. Iraqi, Iranian, Russian, and Saudi Arabian were the most popular nationalities.
- Demand is high for off-plan properties: Off-plan properties are still under construction. They are often sold at a discount compared to completed properties, and they can be a good investment for buyers who are willing to wait.
- Investment opportunities are plentiful: Turkey has many investment opportunities in real estate. For example, buyers can invest in apartments, villas, commercial properties, and land.
- The government supports real estate ownership: The Turkish government is keen to promote foreign investment in the real estate sector. It has introduced several incentives for foreign buyers, such as tax breaks, residency permits, and Turkish Citizenship.
The real estate in Turkey is strong and growing. The cities offer a variety of investment opportunities for buyers of all budgets.
How Much Does Real Estate in Istanbul Cost?
The cost of real estate in Istanbul can vary significantly depending on the location, property type, and various other factors.
Istanbul is a sprawling and dynamic metropolis that offers a wide range of housing options, from historic apartments in the city's old neighborhoods to modern high-rise developments along the Bosphorus.
In general, prime central areas like Beşiktaş, Şişli, and Bebek tend to have the highest property prices, with luxury apartments and waterfront properties commanding a premium.
On the other hand, more affordable options can be found in the suburbs and outlying districts.
The Real estate investment opportunities in Istanbul are plentiful, and its market has experienced fluctuations, but it was generally considered a stable and attractive investment opportunity.
The prices reflect Istanbul's rich history, culture, and economic dynamism. However, for the most up-to-date information on real estate prices in Istanbul, it's advisable to consult a local real estate expert or check current market trends.
Should You Buy Property in Istanbul?
Investing in real estate in Istanbul can be an attractive choice for several compelling reasons:
Strategic Location
Istanbul's unique geographical position bridges Europe and Asia, making it a significant trade, commerce, and culture hub. This strategic location enhances the city's economic stability and growth potential.
Istanbul's location creates excellent investment opportunities.
Modern Property Architecture
Istanbul's beauty varies between historic buildings and modern properties architecture. One of the primary reasons that encourage people to make real estate investments in Istanbul's market is the remarkable modern architecture that has emerged in recent years.
Istanbul has seen a surge in the development of contemporary residential and commercial properties, offering potential buyers a wide range of options.
From luxurious high-rise apartments with breathtaking views of the Bosphorus to stylish suburban villas, Istanbul caters to various tastes and budgets.
The city's real estate developers have adopted a forward-thinking approach, incorporating modern amenities and innovative designs into their projects.
This commitment to modernity and real estate development ensures that investors can access high-quality properties with state-of-the-art features, making them highly desirable in the market, especially with Istanbul's attractive property prices.
The state of the Turkish Lira
The economic landscape is pivotal in foreign investors' decision to own real estate in the Turkish market.
One significant advantage for foreign investors considering Istanbul is the Turkish Lira (TRY) exchange rate.
Over the past few years, the Turkish Lira has experienced fluctuations and depreciation against major foreign currencies, making property investments more attractive for many foreign investors.
Real estate investment in Istanbul is very encouraging due to capital protection, and this is because the prices of properties constantly change with the value of the Turkish lira, and if the prices of the local currency fall, the value of the property rises logically to compensate for any decrease in the cost of your property.
In addition, the Ministry of Economy and the Turkish Central Bank are critical actors in ensuring real estate and product stability and balance against the Turkish lira.
Cheaper Alternatives Most people who want to invest in real estate outside their home nations limit their choices to the most major tourist-friendly countries, such as Turkey.
This favorable exchange rate can translate into significant cost savings for investors who purchase real estate in Istanbul, as they can acquire more for their money.
However, it's essential to monitor the currency's performance and seek advice from financial experts to make informed decisions based on the prevailing economic conditions.
Real estate taxes in Turkey
When trying to find properties in Istanbul, it's crucial to understand the tax implications of your investment.
Turkey has a relatively straightforward and investor-friendly tax system for real estate transactions. The essential taxes to consider include the following:
a. Title Deed Tax: This tax is paid by the buyer and seller when transferring property ownership. The rates vary based on the property's value.
b. Value Added Tax (VAT): VAT applies to selling new properties in Turkey. The rate is typically set at 18%, but there may be exemptions or reduced rates for specific properties, such as residential units of a certain size.
c. Property Tax: Annual taxes are relatively low in Turkey compared to many Western European countries. These taxes are calculated based on the property's assessed value and can be paid in two installments.
The Turkish real estate taxation framework is structured to promote investing in the city's properties. If you're considering purchasing real estate in Turkey, you can expect a fairly manageable tax to maximize the profit and the rental income.
Easy and Safe Buying Process
Turkey has taken significant steps to streamline and simplify the buying process for domestic and many foreign investors.
The government has introduced measures to enhance transparency and provide legal protection to property buyers. These measures include:
a. Tapu (Title Deed) System: The Tapu system ensures that property ownership is registered securely and can be easily transferred. This system provides legal protection to buyers.
b. Property Ownership for Foreigners: Turkey allows foreigners to own properties in most areas, subject to certain restrictions in specific regions near borders and military zones. Acquiring properties as a foreigner has become more accessible and hassle-free.
c. Property Purchase Contracts: Engaging the services of a qualified real estate agent for a safe real estate investment.
Cheaper than most Western European countries
Unlike many other major European cities, Istanbul still offers relatively affordable real estate prices, making it accessible to foreigners.
This affordability can make it an attractive option for individuals looking to diversify their real estate portfolios or find a vacation home in a vibrant, culturally rich city that bridges two continents where you get a lot of choices in terms of properties at low prices compared to western Europe.
You can choose from built residences, apartments, houses, holiday homes, luxury villas, and many more properties across the city. All of these properties come at reasonable prices.
Investing in the European or the Anatolian (Asian) side of Istanbul?
When considering real estate investment opportunities in Istanbul, one must weigh the distinct advantages offered by both the European and Anatolian (Asian) sides of the city.
With its iconic skyline, historical landmarks, and vibrant famous districts like Levent and Maslak, the European side has long been a focal point for real estate investment.
Property values are higher here, attracting international businesses and tourists alike.
On the other hand, the Anatolian side offers a unique blend of modernity and tranquility.
Rapid development and improved infrastructure have made popular neighborhoods like Kadikoy and Uskudar increasingly attractive to investors. The growth potential is substantial, and property prices are often more affordable than on the European side.
The choice between the two sides depends on one's investment goals, risk tolerance, and long-term strategy in this dynamic and diverse metropolis.
To make money in Istanbul real estate, invest like a Turk
Making money from real estate investment in Istanbul is a pursuit characterized by a unique blend of tradition and innovation, and to succeed, one must learn to invest like a Turk.
Turks have long understood the value of owning properties, and this appreciation for real estate as a secure and appreciating asset continues to drive investment in the city.
With a rapidly growing population and a thriving economy, Istanbul's property market remains dynamic and promising.
To make money here, one must embrace modern strategies, market analysis, and respect for the city's unique character and cultural heritage, just as the locals do.
It's a city where the old meets the new, where investors can benefit from both historical charm and forward-thinking development, making it an enticing destination for those looking to invest in real estate with a Turkish flair.
The surprising fact is that you can invest like a Turk. The Turkish government has introduced an investment program that grants Turkish citizenship to foreign investors who purchase properties worth a certain amount, making it an enticing prospect.
Obtaining citizenship and With a Turkish passport in hand, investors gain access to various benefits, including visa-free travel to numerous countries, opening up a world of opportunities for global business and leisure.
So, for those seeking to grow their wealth and secure their future, the Turkish economy presents a compelling avenue to invest and prosper, especially With the Turkish Citizenship by Investment program. Iraqi, Iranian, Russian, and Saudi Arabian were the most popular nationalities