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How to Buy Property in Turkey
2021-01-21

The Turkish Citizenship Law promulgated on February 11, 2010 stipulates that investors can acquire citizenship in Turkey as long as they purchase real estate of USD 1 million or more in Turkey. On September 18, 2018, the Turkish Parliament revised the Law. The original purchase requirement of 1 million US dollars is directly reduced to 250,000 US dollars or the 3 million US dollars required for bank deposits is reduced to 500,000 US dollars. This policy adjustment has sharply lowered the investment threshold for Turkish citizenship, and it has become one of the popular citizenship by investment projects in the market.

  1. Why Turkey?

①The application requirements are loose, and there are no requirements for language, funding source, residence, etc. The main applicant only needs to be 18 years of age and purchase a real estate worth 250,000 US dollars to obtain a Turkish passport in one step, and his spouse and children under 18 can simultaneously obtain Turkish citizenship. You can get a Turkish passport by purchasing a property of USD 250,000. The Turkish passport is visa-free in 117 countries and regions, including Singapore, Japan, Hong Kong, etc. Three years after obtaining the status, the real estate can be sold and capital withdrawal can be realized. With a Turkish passport, you can apply for an American E2 visa to quickly land in the United States. The E-2 visa (Treaty Investor) is a visa issued to citizens of countries that have investment agreements with the United States to work in their investment companies in the United States. This type of visa can enter and exit the United States as well as work in the United States. There is no restriction on the number of extensions of this visa, and you can bring your spouse and children to the United States.

②Turkey is the 17th largest economy in the world and the 7th largest economy in Europe. As an emerging economy of the G20 group, Turkey's economy has grown steadily in the past 14 years, and its GDP growth rate ranks first among G20 member countries! In addition, in terms of infrastructure construction, Turkey is vigorously developing transportation. Currently, six of the top ten super projects under construction in the world are in Turkey, including the world’s largest airport-Istanbul Third Airport. As a "new diamond country", Turkey's development is very modern.

③At present, the Turkish real estate industry is developing rapidly, and it is one of the real estate markets with high investment value in the world. According to the "TURKEY REAL ESTATE SECTOR 2019 Q2 REPORT" published by REITs (Real Estate Investment Trusts, Turkey), the sales volume of Turkish real estate purchases by overseas investors in the first half of 2019 increased by 68.9% over the same period last year, reaching 19,952 units, of which Istanbul With a 44.3% share of overseas housing sales, it has become the most popular real estate investment city for overseas investors. In addition to overseas investors, Turkish real estate also has strong local demand. As a large country, Turkey has a relatively large population. In Istanbul, there is still a large housing gap. In the long run, Turkey's large-scale infrastructure construction, rapid population growth, accelerated urban expansion, and government policy support will also make Turkey's real estate industry full of stamina.

  1. Can Foreigners Get Mortgage?

If applicants want to get a Turkish passport by buying a house, they are not allowed to take a loan. They must use their own funds to purchase real estate in full. This is not only the primary requirement of Turkish immigration policy, but also strict inspections during the actual trial process. . However, the policy requires applicants to purchase real estate of no less than US$250,000, which is actually not difficult to achieve. Therefore, for applicants who want to consider investment immigration, especially those who want to get a passport directly, this budget is definitely available, and there is no financial pressure to pay it in full. In fact, almost all current immigration policies, especially investment immigration policies, require applicants to use their own funds. If all immigrants need loans, it proves that the applicants will not be able to support themselves when they arrive in this country. It is likely to bring new burdens to the society, which is definitely not welcomed.

  1. Is Turkey Property A Good Investment Choice?

Although Turkey's currency has suffered a large depreciation, domestic property prices are on the rise. Due to the impact of the COVID-19 pandemic, the number of home sales in the first few months of 2020 has declined. However, thanks to the government’s policy of lowering loan interest rates in May, the enthusiasm of Turkish local residents for buying houses continued to rise from June to August, compared with 2019. In the same period of the year, the number of real estate transactions even doubled and hit a record high. The rush to buy real estate by local residents has caused the supply of many high-quality real estates to exceed demand, which in turn drove up the price of real estate. Relevant statistics show that as of the first quarter of 2020, the country’s national housing price index has soared by 15.01%, a year-on-year increase of 9.93% from the fourth quarter of 2019. However, in fact, due to the country’s continued high inflation, the growth is much more moderate, with an annual growth rate of 2.82% through the first quarter of 2020. In Turkey, house sales increased by 11.2% in 2020 compared to the previous year and hence, became a million 499 thousand 316. House sales to foreigners decreased by 10.3% in 2020 compared to the previous year. In house sales to foreigners, İstanbul was the first province with 19 thousand 175 sales in 2020. Antalya was the second province with 7 thousand 735 sales. Antalya was followed by 2 thousand 746 sales with Ankara and a thousand 340 sales with Bursa.

source:Turkish Statistic Institute

According to the latest construction cost index report released by the Turkish Statistics Institute, since 2015, Turkey’s construction cost index has maintained a steady upward trend. In the past year, the growth rate of the construction cost index has reached 22.99%, which is the most important factor affecting the increase in construction costs. It is the rise in construction materials and labor costs, and the continued rise in construction costs has also contributed to the continued rise in Turkish property prices to a certain extent.

In 2019, a total of 677,042 people immigrated to Turkey, an increase of 17.2% over 2018. Among them, 45.3% chose to immigrate to Istanbul to start a new work and life. The most immigrant population is between 25-29 years old. Istanbul has a population of 15 million, accounting for 18.75% of the country’s population. Approximately 200,000 people flow in each year. Most of them are young people who come to work and settle. There is a very high demand for real estate purchases, plus those who travel to Turkey. The number of people has increased year by year, and foreign-funded enterprises continue to settle in, and the local rental market also has a lot of room for development.

source:Turkish Statistic Institute

In general, the current property prices in Turkey are not expensive, and there is a high probability that they will rise steadily in the future. For applicants who want to get a second passport overseas, Turkey is definitely a more suitable choice. Passport status can be obtained at a lower cost, and real estate is also a good investment income.

  1. Fees Involved

①House price: no less than USD 250,000

②Deed tax and stamp tax: about 3% of the total property price

③Attorney's fee: USD 10,000, subject to actual expenses

④Notarization fee for transfer contract (only off-plan housing): about 2% of the total property price

⑤VAT: 1%, 8%, or 18% of the house price. It depends on the specific project.

⑥Other expenses: real estate appraisal fee, notarization and certification fee, immigration insurance fee, real estate insurance fee, etc. The specific charges are subject to actual processing.