Property Turkey’s real estate advisers have 20+ years of expertise supporting both buyers purchasing a permanent home or second residence in Turkey, and investors looking for high-return acquisitions that will form an important part of their property portfolios.
The company notes that the priorities buyers should consider differ considerably across these demographics, and that the key considerations when comparing locations, property types, furnishings, and layouts can have a long-term impact on their satisfaction with their decisions.
To assist prospective foreign national buyers currently browsing Turkish properties or setting out the essential attributes they need from their next investment asset, the Property Turkey team has compiled this short guide outlining some of the factors to bear in mind.
Why the Purpose of a Turkish Property Purchase Will Influence Buying Decisions
Many expatriates choose to settle in Turkey for lifestyle reasons or relocate in retirement to benefit from a warmer climate and lower living costs. In these scenarios, the most meaningful factors are led by personal preferences, the areas buyers like and are familiar with, and the amenities they require.
For investors, the emphasis is very different and centres on locations with greater rental demand, depending on whether they are investing in properties intended for short-term holiday lets or long-term tenants, or within regions with strong development potential.
Even within each group, every buyer may have their own requirements or non-negotiables, such as a family buyer requiring a home close to schools and hospitals, a retired couple wanting a nearby established expat community, or a professional picking real estate based on coastal or city living.
Likewise, investors may prefer a lower-cost investment property that is likely to appreciate or might opt to purchase a rental asset in a well-known tourist resort or commercial hub with excellent infrastructure, airports and transport links that their target tenants will want.
The best advice for any buyer, especially those still in the early stages of decision-making, is to think about what the intended use of the property is, because a sea view property may attract consistent rental demand in the summer, with little returns in the winter, and an investment home in an already buoyant market may not attract the greatest growth in terms of resale value.
Exploring Stable Long-Term Personal Turkish Property Acquisitions vs Flexible Investments
In most cases, non-Turkish nationals purchasing a home to live in expect to live there permanently, or for the long-term. That means factoring in aspects like access to outdoor spaces and beaches, the proximity of local shops and amenities, and budgeting for ongoing living costs and maintenance, including service charges for homes in apartment buildings or gated communities.
Short-term market fluctuations, which are common within the high-demand Turkish real estate market, are less of a concern, and provided a property is fairly priced and is considered good value, buyers can proceed with confidence when they find a home that fits their needs.
Time horizons for investors are more subject to change and flexibility, and the relevance of current market performance. Forecast future market changes will be highly relevant as this can directly impact the viability of investing now, or in a specific location.
Investors should have a solid knowledge of real estate market cycles and the current market position compared to a month and a year ago, and seek advice where necessary to ensure they understand how current values are expected to change, whether increasing or decreasing.
Turkish property investors must also balance the returns achievable in the short term through rental income against the saleability and projected value of their investments, based on how long they expect to retain each asset, ensuring they have planned ahead and created an exit strategy.
However, buyers looking for investment homes can also adjust their strategies if necessary, such as selling earlier than originally intended or repurposing an investment building as a holiday let, personal home, or long-term rental unit.
Guidance for Turkish Real Estate Buyers With Uncertain Plans
In some cases, buyers may not necessarily know whether they are likely to keep a Turkish home as their primary personal residence, or a holiday home, or whether, at some point, they might wish to use this as an investment asset or rental property.
While this may not impact immediate buying priorities, if the property is going to be used, at least initially, as a home, it is advisable to be cautious about proceeding with a purchase that could be less viable as an investment, potentially due to the home’s location, distance from tourist areas, or style.
There are trade-offs between personal preferences and the features of a property that will make it easy to rent out in the future, and buyers who aren’t sure how their plans may change should keep this in mind.
Calculating Risks When Buying a Turkish Property
There are inherent risks associated with any property purchase in any country, and these will also differ depending on the reason for the acquisition, although they exist for all buyers.
Those buying a residential home should ensure they have detailed, accurate budgets that take into account income sources in both Turkey and overseas, their tax exposure, living costs, any debt they may be taking on as part of the purchase, and planned life changes such as retirement.
Living costs in Turkey are considered very affordable, but this is subject to change. It is essential that buyers have certainty that they will be able to live comfortably and with the lifestyle they expect in a Turkish home that meets their expectations.
Investment risks are largely financial, with investors needing to contrast the initial costs linked to their investment against potential returns. This means assessing multiple variables such as estimated occupancy rates, rental incomes during peak vs off-seasons, and yields.
Risk mitigation may be more of a focus for investors, but in all scenarios, buyers should make informed decisions with up-to-date insights and support from knowledgeable local agents or advisers who understand the Turkish property market and how it varies between regions.
