Posted on 17 June 2010
While it is not exactly an OMG moment it is certainly significant that Turkish property has just been given a recommended investment rating by Global Property Guide in its Mid 2010 report. In fact, it was the recommended investment location for Europe.
The report is focussed on residential investment, in which case it is predominantly focussed on Istanbul where Turkey is concerned.
Turkish property prices (well, Istanbul, now you’re getting it) have risen rapidly in the last few years, especially on a per sqm basis, and this has made yields average at best. This would usually keep it from being recommended in such a way.
Global Property Guide admitted as much itself, the report says:
Turkey wouldn’t normally make it into our ‘recommended’ list. Yields are in medium-range – 5.5% – i.e., below what we normally consider optimal. But Istanbul‘s low per square metre prices, reasonable round-trip costs, and reasonable tax situation, combine with the country’s attractively young population, growth prospects, and its increasingly core role in the near-East, to make it ‘recommendable’.
The key words there for us is "growth prospects". The EU and several other major investment banks’ research departments have predicted that the Turkish economy will be the fastest growing in Europe this year, and maybe for the next few years. It wasn’t all that big a leap to make from when Turkish growth matched that of China in the first quarter.
While most of our clientele purchases outside of Istanbul in the upcoming touristic zones like Antalya, we see the GPG report and the massive growth potential as beneficial to the market as a whole, because it will increase the affluence of the Turkish population, increase employment, which will grow the internal second homes market, thereby increasing demand and fuelling rental yield and property price growth.