Despite its real estate prices rising by leaps and bounds, Istanbul remains the most attractive Turkish metropolis for foreigners in terms of buying housing. There are pros and cons to this. So, let’s review everything about it!
Content:
- Rental prices
- How to buy an apartment and earn almost immediately
- "Investment-useful" territories
- Promising areas
- Cons of buying a home in Istanbul
- Land and fields
Rental prices
The Endeksa real estate valuation platform recently "updated" the data, reporting that prices for rental housing in Istanbul increased by 144% over the past year and instantly by 319% over the past two years. The average rent per square metre in the average Istanbul province is now 94 Turkish lira (TL), and 10,229 TL per unit of housing. In many areas of the city, rental rates are consistently kept above 10,000 TL, even for very unpretentious apartments in the old fund. As for the sought-after urban areas, the monthly rent there reaches up to 28,000 TL. Finding a housing unit to rent for less than 5 thousand is almost impossible, except in the areas of Silivri and Chatalja.
There’s also very little free housing stock for rent, except for the "elite" segment, which has more choice.
How to buy an apartment and earn almost immediately
So, Istanbul is interesting primarily concerning investment. Housing is always in demand here, as the metropolis is an economic, financial, commercial, and tourist centre, not only in Turkey but also in Europe and the world. Housing for rent is snapped up both for daily rental(tourists) and for long periods (specialists coming to work on projects, students, or residents).
There’re two main options: either buying one or several real estate units and renting them out, or buying at the initial stage of construction, and reselling the completed one, as housing in ready–made apartments is 50% (or more) expensive.
Those who can afford to buy several lots at once with the entry fee (developers are willing to arrange interest-free installments until the end of construction), often buy two to three apartments. Afterward, upon completion of construction, one of the lots is then sold, "closing" their debt for the remaining 1 or 2 residences.
"Investment-useful" territories
However, to receive the most out of your investment, you need to choose the area carefully. Istanbul is a large city, so housing is especially popular a) in the centre, b) in the"nodal" transport interchanges and along the highways, and c) near exhibitions and large financial centres.
If you look at the map, Istanbul is located in both the Asian and European regions, with three bridges "connecting" them. Each of the regions is "tied" to the highway. Accordingly, by default, projects along these highways will be very profitable for investment.
One of these three routes goes further, beyond Turkey, namely, to Europe. So, it’s difficult to overestimate the importance of this route.
On the second of the bridges, you can reach the New Istanbul Airport, where a new metro station is planned to open.
If we concentrate not only on the bridges but also on the development areas, located in the "zone of influence" of Marmaray and the route "branches" connected with it, which are gaining significant importance (and investment "value"). It was this project that "increased" rental rates throughout many quarters.
Basin Express (Basin Exspres Yolu) is another very important "artery" of Istanbul currently being developed. The highway will connect the former Ataturk Airport and the New Airport. This zone is specifically advantageous as the territory has just begun to be constructed in terms of large-scale residential housing and the prices compared to other Istanbul locations are relatively very low here. If we take into account the current dynamics and the growth we saw in 2021, the cost of housing here will rise by at least 100% in about a year or two.
Many developers are already considering potentially interesting territory in the close vicinity of the Istanbul Canal. Apartment buildings and villas are already being built there.
Promising areas
More specifically, by districts.
Thanks to Marmaray, Umraniye has been quickly "adding to its price". The cost of residences, taking into account Marmaray and the associated public transport lines, increased by 36%. This area has caught the attention of developers in recent years. Many large projects have appeared here, including new residential complexes. Well-known companies and large-scale holdings began to move their offices to Umranie and its surroundings, which also affected the price increase.
By the end of 2022 Chekmekey (one of the districts of Istanbul province) appeared in the spotlight, with apartments that at the moment remain relatively budget–friendly: from 700 thousand TL, or 2 million TL for branded residences. At the same time, housing here is rapidly becoming more expensive.
It’s also profitable to invest in the Kuchukchekmedje area now, due to the Metrobus and the availability of convenient "interchanges".
If we talk about the centre, Besiktas, Shishli, and Maslak are always in demand. These areas are now especially popular with foreign investors, even though, the prices are not averagely low, ranging from $500,000 for the 1 +1 format. However, if you plan to periodically use this housing and at the same time enjoy being in the very centre of events, or focus on an investment purchase to rent to wealthy tourists or businessmen, then it makes sense to look at housing in branded projects.
Buyers from the Middle East are increasingly interested in certain areas on the Asian side of Istanbul, where until recently Turks lived almost exclusively, and meeting foreigners was a huge rarity.
However, now there’s a large-scale construction, e.g., in Atashehir, which is tightly "connected" with the financial centre under construction, and will be one of the largest in the world (the seventh most important on the planet). Hence, housing is incredibly profitable in this area from the perspective of investing “right now”. Costs of apartments will double in just one and a half years, or even sooner once the financial centre is opened.
We also recommend paying thorough attention to the Pendik and the Kartal areas. They are not as developed, but transport accessibility is gradually improving, and prices on average are still noticeably lower than in the European part of the metropolis. You can find apartments for $120,000, 130000, and 140000.
Cons of buying a home in Istanbul
There’s only one disadvantage, which is the inconvenience of obtaining a residence permit. A huge number of foreigners already live in Istanbul, and, taking into account the legislative innovations of 2022, a lot of districts are "closed" for obtaining a primary residence permit. This means that if citizenship is your goal, then you either need to take real estate immediately at 400,000+ conventional units (recall, you can purchase more than one unit of housing for this amount) to be able to apply for citizenship under an accelerated procedure, bypassing the 5-year period of renewal of the residence permit.
You can also take a risk and make a deal in an attractive "open" area, but the risk is great: Periodically, the list of districts is being revised, and this area can be "closed" any time (in theory, they can be "reopened" later, but there are no concrete guarantees).
If a residence permit and citizenship are not the goal, then you can safely buy residential real estate in Istanbul without worrying about the "status" of the area. No one will stop you from selling real estate or temporarily living in it within the visa-free days periods for foreigners.
Land and fields
A little information for those interested in lands of various purposes like fields, etc., including those suitable for the construction of small units (a la camping, where these apartment houses can also be rented). To be precise, land prices in sought-after areas of Istanbul province have increased to 4000-5000 TL per square metre.
In this regard, you can look at the territories next to the new Canakkale bridge 1915, where you can still find far cheaper plots, at a rate of 1000-2000 TL per square metre. In particular, you can successfully purchase land with olive groves, and orchards. Some of these sites allow the placement of "caravans", campsites, and tiny houses.
The low prices are explained by the ban on the sale of land to foreigners as private individuals, so to use these territories, you need to carefully study the legislation and resort to the help of intermediaries/open a company, etc. Receiving advice from experts experienced in these matters, particularly a lawyer, is an action that should be taken.