Turkey’s omission from the European Union together with its bullish economy and buoyant property market should make it an attractive destination to foreign investors both before and after the EU Referendum, said Spot Blue International Property in June, adding that Istanbul remains the country’s key investment hub.
“Whatever the outcome of the Referendum, foreign buyers in Turkey know their asset or ownership rights won’t be directly affected to the extent that owners of property in the EU could be,” said Julian Walker, director at Spot Blue International Property. “Being outside the EU means the country has escaped much of the financial volatility caused by the media storm around the Referendum, seen in the UK and Europe.”
Here are four key reasons why investors should consider Istanbul in 2016:
- Strong GDP. Turkey’s economy is out-pacing most countries in the European Union and Members of the OECD. According to the Turkish Statistical Institute, the country’s GDP soared at a rate of 4.8 per cent in the first quarter of 2016 compared with the same period in 2015. A forecast in May by international ratings agency Fitch predicted the Turkish economy would grow at a rate of 3.5 per cent this year and 3.6 per cent next year. Of all G20 countries, only China and India recorded higher GDP growth than Turkey during 2015.
- Currency advantage. Volatility in the £/€ exchange rate and how it will react after the Referendum are bringing uncertainty to UK investors buying in the EU right now. Property in Turkey is sold in Turkish lira, euros, dollars and sometimes Sterling, giving an international buyer flexibility and presenting opportunities to minimise exposure to currency rates. Turkey not being in the EU means the Sterling/Turkish lira rate will be less affected by whatever the outcome of the Referendum.
- Property sales underpinned by non-EU market. The largest groups of property investors in Istanbul and wider Turkey are from the Gulf States, in particular Saudi Arabia, the United Arab Emirates and Kuwait. They will remain interested in Turkish property, continuing to drive the market and bring foreign money into the country, whatever the outcome of the Referendum.
- More benefits for foreign workers, businesses and homeowners. Turkey is making serious efforts to entice more overseas workers, firms and residents in 2016, in particular to Istanbul. This in turn should have positive effects on demand for residential and commercial real estate. In June Deputy Prime Minister Canikli revealed draft laws to improve investment conditions, which included reduced tax rates for foreign firms setting up and purchasing real estate. Canikli also announced plans for a series of regulations that would improve employment conditions and opportunities for foreigners. Elsewhere, in the same month Economy Minister Nihat Zeybekci said that the Turkish Cabinet was set to offer citizenship to foreigners who buy a number of properties in Turkey.