New property laws in Turkey are increasing the real estate prowess of its cultural capital Istanbul – so where’s best to invest?
The winding Bosphorus Strait separates the European and Asian shores of Istanbul. Legend has it that Jason and the Argonauts navigated its entire length in search of the Golden Fleece. These days, galleon-bound crusaders have been replaced by snap-happy ferry tourists eyeing up the city’s shimmering shoreline with its myriad minarets, mosques and palaces. But while the legacy of Byzantium and Constantinople lives on in the vintage architecture, it’s the modern gloss of trendy restaurants, boutiques and nightlife that’s bringing a fresh energy to this cultural Mecca.
Positioned (for the moment at least) away from the blighted euro, Turkey’s pulling power as an investment haven remains relatively unscathed, compared with vintage rivals Spain, Italy and Portugal.
EU accession “positive-agenda” talks this year, together with a new property law passed this August have also given a fillip to residential tourism initiatives. The old reciprocity rule, which only allowed foreigners to buy Turkish property if they were from countries where Turkish residents could buy homes, is now being phased out. Remodelled residential zones are now springing up around the city’s historic old quarter and new-build resorts in the outlying suburbs are attracting foreign buyers hoping to cash in before prices start to climb.
While most longstanding expat owners (British, French and Dutch) have put down roots in the well-aged but touristy quarters of Macka, Beyoglu and Taksim, urban regeneration now means previously “off-radar” neighbourhoods are open for business.
Mainstream investors looking for steady rental return, meanwhile, are taking their pick from the growing number of buy-to-let projects springing up in the city outskirts.
Buying in Istanbul
Applications to buy need to be agreed by the local council and Turkey’s Army Office.
Fees include estate agency (three per cent of the purchase price), legal fees (approx £400), purchase tax (three per cent), and land registration (£30).
There is no Capital Gains Tax (CGT) if you keep your property for five years. Property sold before that period is levied on a sliding scale up to a maximum rate of 35 per cent.
VAT is payable on new-build flats from one per cent rising to a ceiling of 18 per cent for larger properties.
source : telegraph.co.uk