Turkey 2nd most popular country to buy property in the next three years - NatWest survey of mortgage lenders, February 2008

The property market

All the ingredients that make Turkey such a popular holiday destination are now fuelling unprecedented interest from foreign property buyers.

A warm Mediterranean climate, beautiful scenery, friendly people and value for money have been attracting tourist to Turkey for decades. The Turkish government is now channeling huge public and private investment into the country’s infrastructure as part of its ambitious plans to nearly double the number of annual visitors to 63 million by 2023 - placing it in the world's top five tourist destinations. New roads, marinas, golf courses and airport terminals are transforming the coast, as well as increasing property values. Indeed, with prices currently significantly lower than more established markets, such as Spain and France, the potential for strong capital growth is a key attraction for many buyers.

Rapid development has changed former fishing communities like Bodrum and Alanya into major international resorts. Leisure facilities, such as the golf courses in Belek and a string of marinas along the coast have added to the appeal for many. But those seeking a quiet Mediterranean retreat need not be disappointed, as a slower, more traditional way of life still persists in the smaller resorts and countryside. Infact, Turkey has some of the most unspoilt stretches of coastline in the entire Mediterranean.

In anticipation of the start of EU entry negotiations in 2006, British buyers flocked into the Turkish market eager to benefit from rising property values. Encouraged by the affordability of Turkish property, with prices far lower than more established overseas markets like Spain, thousands took the plunge. Official statistics show that the British are the leading foreign purchasers, buying over 14,000 properties between July 2003 and the end of 2006.
Although negotiations with the EU have slowed, the reforms introduced to allow the start of membership talks have been hugely beneficial for the country. Economic growth and investor confidence is strong, with $2 billion invested in real estate from abroad in 2006. Total foreign investment is expected to double in 2007.
A 6-month ban on foreigners buying property in 2005, while the country’s property legislation was re-drafted, along with worries about Bird Flu and the 2006 World Cup, put a temporary brake on the market. But the amended law, unveiled in January 2006, has no effect on the vast majority of people, who buy in resorts, towns or cities.

Despite significant increases in prices over the last 3 years, Turkish property remains comparatively cheap. The recent introduction of mortgages for foreign buyers has increased finance options. It is still possible to pick-up budget apartments for less than £35,000; while at the top end of the market luxurious villas with stunning sea views are available for £275,000 – a lot less than you’d pay elsewhere in the Med!