Investments in Turkish real estate for Russians: advantages and pitfalls

Most housing market experts agree that investing in Turkish real estate is still relevant and is guaranteed to bring you the expected dividends in the future. But there are also those who urge investors: do not buy apartments in Turkey! So where is the truth? Let's figure it out!

Of course, buying real estate in Turkey is a responsible step that requires not only financial investments, but also a detailed analysis of all the nuances. The Eastern Republic opens up many opportunities for foreign buyers, but as in any other area, acquiring real estate has a number of pros and cons.

Should Russians buy apartments in Turkey now? You will find the answer to this question in our expert article.

The benefits of buying property in Turkey

First, let's figure out what is behind the high interest in buying apartments and villas in Turkey.

The main advantages of purchasing real estate in Turkey:

• Simplicity of registration of the purchase and sale transaction.
• Large selection of liquid assets.
• Apartment prices are lower than in the EU countries.
• Installment plan from the developer is available.
• Complete improvement of residential complexes.
• The quality of construction meets international standards.
• There is no need to spend additional money on repairs.
• Demand for rental housing.
• Rising property prices.
• Simplified procedure for obtaining a residence permit and citizenship.
• Tax incentives.

Simplicity of execution of the purchase and sale transaction

You can buy a house in Turkey, having concluded a legal, safe transaction, in just a week. The step-by-step procedure consists of several stages:

1. Selection of apartments.
2. Reservation of the property and payment of a deposit (approximately 10% of the total cost).
3. Registration of TIN at the Tax Service.
4. Opening a bank account.
5. Payment of taxes and fees.
6. Re-registration of the title deed (TAPU).

In addition, Turkish law allows foreigners to buy real estate remotely, that is, by delegating the relevant powers to their attorney. To do this, you will need to issue a power of attorney to a notary.

Large selection of liquid assets

Foreigners in Turkey have access to a wide range of real estate options: from inexpensive apartments with a layout of 1+1, 2+1, 3+1 and apartments with a view to townhouses comfortable for family living, luxury villas and chic penthouses with sea views.

Moreover, decent properties are presented both on the secondary and primary markets, both in long-developed and in developing new promising resort areas. Buying apartments in Turkish new buildings is possible at all stages of construction, including the project stage.

Apartment prices are lower than in the EU countries

The Turkish property market proves that high-quality housing can be affordable. Although property prices in Turkey have risen in recent years, they are still lower than in many EU countries. For example, in Alanya, the pearl of the Turkish Mediterranean, one-bedroom apartments start at 70,000–80,000 EUR. By comparison, similar apartments on the French Riviera will cost at least 200,000–250,000 EUR, and in Spain – around 120,000–150,000 EUR.

Installment plan from the developer is available

Turkish construction companies provide the opportunity to purchase housing using payment installments for the construction period and longer. The investor pays an initial payment not exceeding 30% of the total cost of the property.

One of the key advantages of this scheme is the absence of interest, due to which the total amount of payments corresponds to the initial price of the property. In addition, developers offer flexible installment terms and a convenient schedule, allowing buyers to adapt payments to their financial capabilities.

Complete improvement of residential complexes

Turkey, famous for its luxurious five-star hotels, brings a similar level of sophistication to residential complexes. Apartment owners in these locations enjoy premium amenities such as swimming pools, saunas, Turkish baths, fitness centers, tennis courts, indoor parking and more, right on the premises.

The safety of residents is ensured by 24-hour security and a video surveillance system, which makes living not only comfortable, but also safe.

The quality of construction meets international standards

In the construction sector, Turkey demonstrates a level of quality comparable to European standards. The country's laws strictly regulate compliance with all construction standards, including seismic resistance, environmental friendliness and energy efficiency. Developers actively use the latest technologies and materials, which makes housing not only attractive for investment, but also resistant to climate challenges.

No need to spend extra money on repairs

Turkish construction companies offer apartments with already completed finishing, which saves owners from having to invest additionally in repairs. Your new apartments after commissioning will have:

• high quality flooring,
• waterproof painting of walls in neutral tones,
• modern double glazing,
• strong steel entrance doors,
• stylish interior doors,
• high-quality ceramic tiles and modern plumbing,
• built-in kitchen unit.

This allows you to save both money and time for the owners, which could be spent on finding reliable contractors and monitoring repair work.

Demand for rental properties

In 2023, Turkey was visited by over 57,000,000 tourists. The popularity of the resorts on the Mediterranean and Aegean coasts among Europeans and citizens of the former CIS countries is due to the wonderful climate, variety of entertainment, hospitality of local residents and moderate cost of vacations.

The growth of tourist flow stimulates local authorities to improve social and entertainment infrastructure. A shift in tourists' preferences is also noted: if previously many chose hotels, now more and more guests of the country prefer rented apartments. This creates excellent opportunities for the rental business.

Investing in real estate, especially in places like Alanya, allows you to receive a stable passive income from renting out in the amount of 8-12% per annum.

Rising property prices

Over the past few years, the Turkish real estate market has shown significant growth in the value of properties. Only in the first half of 2024, there was an adjustment in prices for secondary real estate and for primary market properties at the final stage of construction. But even against the background of some price decline, investment-attractive Turkish apartments remain a reliable asset and allow you to earn money on resale in the long term.

Buying at the initial stage of construction can be especially profitable due to the fact that the price tag for housing is 20-30% lower than for a property that has been put into operation.

Simplified procedure for residence permit and citizenship

Buying real estate in Turkey guarantees foreign citizens simplified access to a residence permit and citizenship. Purchasing a property automatically gives the right to a residence permit, and after five years - to citizenship by naturalization.

Since October 2023, the minimum cost of an apartment to participate in the program is USD 200,000. If the cost is below this threshold, foreigners can only count on a tourist residence permit, which is not taken into account when calculating the period for obtaining citizenship.

Those who are willing to invest over USD 400,000 are given the opportunity to obtain a Turkish passport in an accelerated manner within six months. The investment program also applies to spouses and minor children of the main applicant.

Tax incentives

Turkish authorities are actively introducing tax incentives to attract foreign investment. Thus, buyers of real estate from a developer who do not have a residence in the country are exempt from value added tax.

The financial deduction of value added tax allows you to significantly reduce the costs of purchasing real estate, since the VAT rate can reach 18%.

Pitfalls and risks when buying real estate in Turkey

Of course, in addition to the advantages, there are also risks associated with purchasing Turkish real estate, which foreign investors need to know about in advance.

The main pitfalls and disadvantages of buying an apartment in Turkey:

• Ignorance of laws and language.
• Fraudulent schemes involving paperwork.
• Unreliable developers.
• Additional costs for concluding a transaction.
• High fees for maintenance of the residential complex.

Ignorance of laws and Turkish language

Lack of knowledge of Turkish legislation and language is probably one of the first reasons why foreigners have problems when buying real estate in Turkey. Any purchase and sale transaction executed abroad is a responsible step that must be approached with the utmost seriousness and professionalism. The success of the investment and how satisfied you will be with the purchase depend on this.

Fraudulent schemes involving paperwork

One of the risks of buying real estate in Turkey is problematic documents. Before completing the transaction, it is important to carefully study the title documents for the property and their legal purity. Find out who owns the building and land, make sure there are no encumbrances in the form of collateral, loans, or debts.

High fees for maintenance of the residential complex

In addition to the cost of apartments in Turkey, the investor needs to plan his budget taking into account the costs of maintaining the property. Namely, the monthly payment of utilities and aidat - a mandatory payment for all owners for servicing the infrastructure of the residential complex (swimming pools, playgrounds, hamam, gym, security, parking, etc.).

Aidat depends on the status of the residential complex and the variety of infrastructure facilities. If your budget for purchasing housing in Turkey is limited, check the amount of monthly payments with the developer or seller in advance to avoid getting into an unpleasant situation after concluding the purchase and sale agreement.

Unreliable developers

Most developers in Turkey are reliable companies that have earned a good reputation with clients, have an extensive case of successfully implemented projects and provide a wide range of services. But as in any other country, in the Turkish real estate market there are occasionally unscrupulous developers, cooperation with whom threatens investors with a loss of time, effort and deception of expectations. In particular, we are talking about low quality of construction and delays in the delivery of the facility.

Additional costs for transaction execution

Any real estate purchase and sale transaction in Turkey is accompanied by additional costs for registration: translation and notarization of documents, apostille, payment of state duty, and fee for registration of TAPU.

In Turkey, the taxation on buying a home is much lower than in many European countries. However, some unscrupulous agents deliberately do not explain all the cost items, which threatens not only a bad mood, but also overpayment.

Pros and Cons of Buying Property in Turkey

The main advantages of buying real estate in Turkey:

• A simple purchase and sale transaction.
• Wide choice of liquid assets.
• Relatively low cost of housing.
• Interest-free installment plan from the developer.
• Complete improvement of residential complexes.
• The quality of construction meets international standards.
• There is no need to spend additional money on repairs.
• Demand for rental properties.
• Rising property prices.
• Simplified procedure for obtaining a residence permit and citizenship.
• Low taxation and benefits

Disadvantages of buying an apartment in Turkey:

• Ignorance of laws and language.
• Fraudulent schemes involving paperwork.
• Unreliable developers.
• Additional costs for transaction processing.
• High costs of servicing a residential complex.

Should Russian citizens buy real estate in Turkey now? How profitable is it?

In the first half of 2024, property prices in Turkey have declined slightly due to inflation and the ongoing rebalancing process in the Turkish economy, declining purchasing power, an increase in the number of properties on the housing market, a decline in interest from foreign investors and an increase in interest in other investment options.

Nevertheless, most industry experts agree that the current situation on the Turkish market cannot be called stagnation. There was a natural adaptation of prices, given that initially, against the backdrop of geopolitical problems and waves of migration, the cost of real estate in 2022-2023 increased sharply. Moreover, the size of the adjustment depends on the region: that is, where the cost threshold was initially low, prices have hardly fallen. And in cities popular among investors, a more noticeable reduction in the cost of secondary real estate and apartments from developers at the final stage of construction was noted. As an example, it is appropriate to cite the situation in the real estate markets of Mersin and Alanya.

So, should Russians buy real estate in Turkey in 2024? Of course, yes. But there are several important points to consider:

1. The real estate market of any country is cyclical, that is, the decrease and increase in cost occur periodically, and Turkey is no exception. Therefore, it is important to remember that buying real estate is a long-term investment that will not bring the expected result immediately.
2. Any crisis, with a competent approach, becomes a good start for financial growth. For example, now buyers can buy liquid and unique projects in Turkey in investment-attractive locations at an adequate price, which was impossible to do a year or two ago.
3. Pay attention only to the promising real estate markets of Turkey - Antalya, Alanya, Mersin, Istanbul, Izmir.
4. Clearly define the purpose of the purchase - for living, profitable investment, renting out.

And most importantly, contact market professionals - experienced real estate agencies - if you want to get a predictable and good result. The specialists of the licensed company Altop Real Estate will help you with this. Our impeccable reputation, high qualifications and experience, as well as a wide range of services guarantee you a completely safe and profitable purchase of liquid real estate in Turkey.