The ability to purchase a property in installments is among the most significant advantages available to foreign investors who want to own real estate in Turkey. Turkish and foreign buyers are treated equally by the nation's government, which prevents discrimination. It is true that you can obtain a mortgage to purchase apartments in Turkey, but you will have to pay excessive interest, and the loan amount offered to a foreigner may be very low. An installment plan from the developer is thus popular among foreign citizens. In this article, you can learn about the availability of installment plans in Turkey as well as the requirements for their use.
Content:
- How to acquire property in Turkey in installments?
- Stages of a home purchase in Turkey using installments
- Installment pros
- Cons of buying in installments
- How profitable is a payment plan for real estate?
- Do home purchases made in installments qualify for Turkish citizenship?
- Conclusion
How to acquire property in Turkey in installments?
The lack of overpayment and security provided by the fact that the construction company owns the land on which the project is being carried out are the main benefits of the installment plan and help to lower the likelihood of losing money.
The developer will be involved if you want to pay in installments. This opportunity is provided by almost all construction firms. For those considering paying for a Turkish property in installments, here are some tips:
- Make sure the company you select has a license and a clean record. You can verify this by conducting your own online search or using an independent agent.
- Make sure the payment schedule provided by the developer fits your income by asking for a payment plan. The majority of construction firms provide flexible payment plans that require equal monthly or quarterly payments over a period of three years to cover the cost of an apartment or house.
- Verify that the business has secured from the appropriate authorities all required building permits and licenses.
- Learn from the developer about the after-sales services that may be required if you need any help after purchasing the property, such as property management for short-term rentals. Important: Foreign homeowners in Turkey can only rent out their own homes and apartments on their own for extended periods, and they must use a management company for short-term rentals. This is a crucial consideration when picking vacation rental property for tourists.
Stages of a home purchase in Turkey using installments
- To purchase a piece of property in installments, the first step is to look for companies that provide this payment option. Once you have found several developers, you can evaluate their offers and select the one that most closely matches your requirements.
- Finding suitable apartments in development projects in Turkey is the second step. Once you've decided on a unit, get in touch with the firm to learn more about their own payment schedule. Be sure to get details on the first installment and subsequent monthly payments. Typically, the first payment is between 25 and 50% of the total. Sometimes a developer will only offer installments for a year, which can be challenging given the high monthly payment.
- Make a request to buy real estate. The company will get in touch with you to finalize an agreement before sending the first payment. Before signing the document, make sure you have read it thoroughly.
- The first installment must be paid as the fourth step. After that, you will only need to send monthly or quarterly payments, and as soon as you pay the entire amount, the property will be yours!
Installment pros
The principal benefits of paying for real estate in instalments are:
- The full cost of the apartment does not have to be paid all at once.
- You are free to select the housing that best suits your needs and preferences, not the one for which you have the necessary funds.
- Unlike a mortgage, there is no red tape involved in the collection of documents because the developer does not need proof of solvency because the unit actually remains his property until full payment.
- You do not need to overpay because the interest rate for installments is 0%.
Cons of buying in installments
Is it a good idea to purchase a home in Turkey in installments? Of course it is. Because you don't need the entire amount at once, this is practical. There are a number of drawbacks, though.
- Cost. A good discount is frequently provided by the developer company, but it is only valid when paying in one lump sum.
- A small selection. You won't be able to select a home from the secondary market if you buy it on installments, and some developers may have inconvenient payment schedules.
- Ownership certificate. Only after all payments have been made when purchasing in installments will you be given a certificate of registration. In actuality, the developer will still own the property until that time. There are, however, a few companies that only require payment of 70% of the total cost to issue a certificate of registration.
- Substantial monthly payment. Since a loan's term is typically no longer than three years, installment payments are more expensive.
How profitable is a payment plan for real estate?
Even if you choose to pay in instalments, there is a way to save. This is the purchase of property at the beginning of construction. In Turkey, there can be a 20–40% price difference between a housing unit at the beginning of sales and rented housing, so seasoned investors pay attention to project announcements to make minimum investments.
Do home purchases made in installments qualify for Turkish citizenship?
The possibility of becoming a citizen of Turkey is one of the allure of investing in Turkish real estate. One or more residences must be purchased for a total of $400,000 to be eligible for a Turkish passport. This programme also functions in the case of an installment agreement, but there is a small catch: you can apply for citizenship with an installment agreement, but the passport won't be issued until all payments have been made.
Conclusion
Paying for a new home in development projects in Turkey in installments is as hassle-free as possible. The most important thing is to take your time when selecting a developer and learning the details of the programme. Only after that will your investment be worthwhile!