 While the prices of homes in Turkey are no longer soaring up, the future is still looking very good for this market. By DAVID O'BYRNE The smell was of something long dead, and the view one of complete desolation with ripped clothes, yellowing documents and several thousand used plastic carrier bags strewn across the mouldering linoleum. But it was mine, and I had plans. As my first and, to date, only venture into the Turkish property market, my purchase of a near-derelict flat in a 19th-century Greek apartment building in the ancient Istanbul quarter of Galata involved a massive 18-month restoration not to mention an interminable learning curve covering everything from Turkish property laws to how to persuade the local gas company to run a pipe down the street. Although often frustrating to the point of exasperation, it has never been a step I've regretted. Not least because as one of the first foreigners to buy and renovate an old property in Istanbul, I was lucky to be ahead of the curve. I have watched my €15,000 grow to somewhere close to €200,000 10 years later, while enjoying the luxury of living rent-free slap bang in the centre of town. Not that I've been alone in the experience. The past five years has witnessed a near-whirlwind transformation of Istanbul's historic quarters, as entire streets of derelict properties have been transformed into prime restored real estate, owned, occupied and rented by Turks and foreigners alike. But while the era of unimaginable bargains is now long over, for the sensible buyer property in Istanbul still represents a sound investment, with beautiful historical properties still available for very reasonable prices, which can only rise with Turkey's EU membership process underway. Smaller, unrestored flats in the central and historic Beyoglu and Galata districts are still available for as little as €100,000 depending on condition and location, while even large renovated properties with expansive sea views can still be had for less than €500,000. In other historic areas away from the centre, such as Fener and Balat, €100,000 can still buy an unrenovated three-floor  Greek house, while in the central but far rougher districts around Tarlabasi Bulvar, flats go for as little as €50,000. And with both state officials and major Turkish investors trumpeting their intentions to broker the wholesale restoration of the city's historic quarters on a daily basis, now is definitely the last chance of picking up a bargain. The more so given that recent changes to the law have allowed the establishment of Real Estate Investment Trusts, with several focusing on the purchase, renovation and renting of historical property, while a still pending law allowing the sale of property mortgages has already pushed up prices ahead of an expected boom in house sales. For new arrivals there is no shortage of free advice from consulate websites and real estate agencies. Foreigners have exactly the same purchasing and ownership rights as nationals, providing a reciprocal agreement exists, with the sole exception of a ban on buying in areas of military sensitivity. But buyers still need to be wary. When government ministers – a breed not noted for their high standards of probity – start railing about the low standards among the country's estate agents, you know there's a problem, and these days few would attempt to purchase property without the help of a competent legal adviser. But even their powers are limited, as can be gauged from the recent news concerning one of Istanbul's most prestigious residential developments: the top 19 floors of its twin towers had been constructed illegally, and may have to be removed. Bad news for the families of two former Turkish prime ministers, reported as being among the investors.  BUYING IN TURKEY Confusingly there are three basic types of Tapu or property deed in use in Turkey, which bestow different levels of ownership and security. Generally houses and land ownership is via the Tek Tapu which bestows clear single ownership. Buyers should avoid any property where a shared deed – Hisseli Tapu – giving less than 100% ownership is on offer. For flats, again two types of Tapu are available. The Kat Mulkiyetli Tapu gives the buyer ownership of a designated flat in the building plus a designated share in the land the building stands on. Again Hisseli Tapu, which give the buyer only rights as a minority shareholder in the land parcel with no guarantee of ownership of any space within the building, should be avoided at all costs. With the exception of the capital, Ankara, where property is in demand from the ever-increasing number of diplomats, lobbyists and consultants descending on the capital as Turkey's EU bid progresses, most interest in property in Turkey is in the Aegean and Mediterranean coasts. Foreign buyers are almost exclusively from northern Europe, with interest largely focused on a few popular resort regions. Buyers in Fethiye and Didyma are almost exclusively British; Brits also account for most foreign purchases on the Bodrum peninsula. The Danes, Dutch and Swedes are also buying around Bodrum, and the Irish in the Mediterranean resort of Alanya. The bulk of interest in is new-build villas and flats, generally in purpose-built complexes, with some braver souls buying land and opting to build themselves. With prices no longer exhibiting the 300% annual growth experienced after Turkey's economic collapse of 2001, most buyers are interested in long-term investment, either looking to use the property themselves, for retirement or for own use over part of the year, and as holiday let for the remainder. Prices for villas with pools start at around €110,000 for low-end properties not close to the shore, rising to €400,000 for prestige sites adjacent to marinas, with two-bedroom apartments available for €50,000– €150,000, depending on location and facilities. Villas are almost always freehold, with a full Tek Tapu, while flats should come with a Kat Mulkiyetli Tapu. Buyers who are unfamiliar with the system should hire a lawyer to make the necessary checks. The biggest bargains still available in Turkey are on land purchases. Private owners, state bodies and local authorities regularly put large tracts of land on the market, generally broken up into smaller parcels so as not to exceed the 25,000 m2 limit for foreign buyers. Around the popular resorts prices are high and there is little saving to be made on buying ready built property. However, in quieter coastal towns such as Datca prices can still be as low as €20–€30 per m2, while in inland areas still in the Aegean region this can fall as low as €3–€5 per m2, with prices in Turkey's poorer eastern regions lower still. Again, professional help is essential in gauging whether a particular tract is a good investment or a potential minefield. Land within municipal boundaries will be subject to local authority zoning laws and a thorough check is required to see just what you can build, covering how much of your land. In general, on land outside municipal boundaries, building is permitted on only 5% of a given parcel, unless there is an existing building or derelict building. All construction is completely forbidden on land containing registered archaeological sites or those that are environmentally sensitive. Other zoning restrictions may also apply, depending on where the land is sited, and in all cases potential buyers should obtain competent legal advice. |