Turkey Property Takes 2Nd Place For Investors
News Posted On: 23 July 2013
A report by UK – based professional services firm Ernst and Young indicates that Turkey is the second most attractive property market worldwide for investors.
The list, compiled by surveying leading real estate investors, showed some other surprises too, with Sweden in the top spot where many might have thought to find Germany, which came fourth after Luxembourg. The UK came in at seventh place.
Surveyed on the market attractiveness of 15 European countries, 40% of respondents rated Turkey as ‘very attractive, and 60% rated it ‘attractive.’
There are figures to support those opinions, too. Nationwide residential sales for homes and domestic properties rose by 9.13% year-on-year in 2012 after adjustment for inflation, while construction activity and residential permits have also risen by 16%, and mortgage interest rates have been declining steadily since 2002. Meanwhile, Istanbul saw price rises of 17.75% year-on-year to September 2012 and rental increases of 15.2% for the same period.
Julian Walker of Turkish property agents SpotBlue says, ‘Turkey’s property market is going through a very successful phase right now, with 4 out of 10 people finding the idea of purchasing property in Turkey an appealing prospect. The property market in Turkey has something for everyone, from palatial commercial premises to coastal domestic residences, and the new report from Ernst and Young lends weight to the idea of Turkey as an up-and-coming country for commerce, as well as an enduring heavyweight in the tourism industry.’
Turkey may be the latest in a string of Mediterranean countries including Morocco to benefit from second-home, investment, expatriate and tourist money that was previously spent in France, Spain, Italy, Greece, Cyprus and Portugal.
The results of the Ernst and Young report come a year after Turkey unilaterally sanctioned the ownership of property by nationals of foreign countries whose own laws forbid the ownership of property by Turks.
Turkey has also experienced robust economic growth in recent years, another factor it shares with Morocco but not with more familiar European Mediterranean destinations. Between 2001 and 2007 Turkey saw economic growth figures of 6.8% a year on average, and the country has largely escaped the property market crashes that followed the 2008 banking debacle in Greece. In 2010, Turkey posted 9% growth; in 2011, 8.5%. Property prices are expected to rise in step with the economy in 2013 and 2014, and Europe’s woes pulled its rate down to a relatively paltry 2.2%, that’s still a better figure than most of Turkey’s European neighbours managed.
And the current investment environment hinges partly on an intangible; if Turkey succeeds in getting the 2020 Olympic Games in Istanbul, property prices there are set to rise sharply, with a knock-on effect across other major Turkish cities as demand diffuses. There’s already strong interest in Turkish property from cash-rich investors from Russia and the Gulf states, and Asian investors are eyeing Turkey for business purposes; if the Taiwan External Trade Development Council follow through on plans to enter the Turkish market for improved access to the Middle East and North Africa, employees will need houses and leisure and jobs will be created, further spurring Turkey’s economy – and its housing market.
Written by Les Calvert
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