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Showing posts with label Buy Property in Turkey. Show all posts
Showing posts with label Buy Property in Turkey. Show all posts

Friday, June 5, 2020

Property in Turkey: Buyer Beware of Self-Inflicted Injury

Property in Turkey: Buyer Beware of Self-Inflicted Injury….

 

During the last 13+ years more than 70,000 foreigners have purchased property in Turkey….

More than 85% have suffered with difficulties from what happened AFTER the purchase. First it was the British and Northern Europeans; then the Kuwaitis and their complaints resulted in a diplomatic incident; now it’s Citizenship Investors.

 

Official Turkish government agencies have been very proactive in providing solutions. For example, the Office of the President of Turkey has a website dedicated to providing information to guide foreign investors, and several other local agencies have the same. Unfortunately NONE of these websites receive links from the English speaking agents and develops websites (with one exception). Instead, several new websites have sprung up by agents using very similar website names as the government ones: to lure unsuspecting foreigners.

 

So foreigners face some problems when buying property in Turkey, and usually do not find out until after the purchase. To say that the official channels are not very helpful is completely inaccurate. So what is the problem…?

 

The real problem is that many foreign investors prefer to delude themselves, even when they have been told of the risks and problems. Instead of using independent professional advice, they continue to rely on the English language agents’ websites. This leads them to do things they would not do when buying a property in their own country. Perhaps because living in a property all their life, they imagine they know everything necessary to buy one, in a foreign country with an unfamiliar legal and property system.

 

And then there is simple delusion: usually they prefer to take a chance with an agent by convincing themselves it will be all right, all the while knowing they will be paying huge hidden price mark-ups of $20-30,000 instead of paying $2-3000 to a professional advisor in fees. Paying fees to professional advisors is clearly much more difficult for these naive investors, than paying 10 Xs as much in an agent’s hidden price mark-ups. And for that reason the agents continue to do thrive and do business, and the naive foreign investors continue to complain about being ‘ripped off’; but it is a self inflicted injury.

 

Read below how foreign citizenship investor have described their recent experiences;

 

‘---- On Sat, 11 May 2019 13:16:52 +0300 (PersonalDetailsRedacted forPrivacy) wrote ----

 

Its very simple, let me explain my position.

I am looking to buy a property in Turkey for the purpose of Rental Income. I have visited Istanbul back in Nov 2017 and realized the following:

  1. Most of the Agents try to see you over priced properties in new developments in  BaşakşehirEsenyurtAvcılar, Buyukcekmece,etc. There are areas far from center and NOT good for rental income. or even resale because no ones going to buy from you when there is an abundance of properties already available direct from constructors ones. I checked later with some of my arab friends and realized they (few ones I know) bought into these areas back in 2013+ and now not able to resell it at all. 
  2. The rental income promised to me for some of the properties shown (during my stay in istanbul agents showed me several properties and even projecs like denize istanbul) that I will get 7% Rental Yield and that in 3 years 20% Price appreciation. I later found out from reliable internet europe based sources that the rental yield in turkey is the lowest some where from 2.5% to 3% as NET (after you deduct the rental income tax etc) and that too were for areas like lavent, nisantasi, florya etc. These new dev areas stand no chance near the same figure.  
  3. Later in 2018, Lira crashed  (when I visited Istanbul in nov 2017, I cached 1 SAR for 0.95 Lira and now 1 SAR fetches 1.6 Lira) do the math. and see for yourself has the property really appreciated for folks who are foreigners and sending Euros or USD or SAR or AED to buy properties? I feel they will lose their capital even if they are able to resell and bring back the dollar value..

 

  

---- On Sun, 23 Jun 2019 20:27:20 +0300 (PersonalDetailsRedacted forPrivacy) wrote ----

 

Let me make a few statements so you know the background

 

  • Based on my one year research and personal visit to Istanbul and understanding, I have opinion that 95% of the agents lie and cheat. In the sense that they will inflate the prices. This is true for either agents or developers. The moment they know you are a foreigner they haunt you and think all foreigners are stupid. So I stay away from such agents. Unfortunately there are no English language folks or depts in Turkey for info gathering so I will need to get a turkish person or company else I could have done all by myself. I am a salaried person but i manager to create a couple of good properties in Dubai completely with my own efforts and now enjoying 6% (it was 9%) net rental yield in Dubai. of course not all properties will give you that . you need to be brutal in your research not to fall for those greedy and cunning agents or builders. there is a whole lot of research involved like the past experience of the builders. how many projects it completed. visiting the completed projects, talking to people there, knowing issues of maintenance, visit forums etc etc. its a hell of a process and i was able to do all for dubai because every one speaks english
  • My aim to invest in dubai is twofold. One is to diversify my portfolio as dubai is now down in terms of profit but still better, yet its good idea to diversify and second is to get turkish passport. Of course my main strategy is to use the property for rental income.  am not in for flipping properties. However i should atleast ensure that in 5 years time that i should be able to sell those easily in secondary market. Hence I realized from global property websites that turkey is the lowest in rental incomes; avg 2.5 to 3%. Now all of the agents and developers boasted a lot to me claiming 5 to 8% and thats a big lie. All over world avg rental yield is hardly 3%. Anyway am good to go with 3% net in turkey.
  • The new developements claimed in center like maslak or sisili are not exactly in that close. Take for example avengart which is situated up close to the belgard forest. Likewise these new developements are very large in nature with glass walls and all that fancy stuff. maybe appealing to rich arabs --fine. but i doubt i will be able to rent them easily. avengart may have say 500+ units but how many clients will wan to rent? i doubt it. also the example of zorlu i saw so many ads on sahebindan that I am sure 30% of zorlu flats are up for rent -means vacated. Even if am lucky my rentai will be quite low. for exampe the avengart developer says list price 1m but may give upto 900k for cash. In my view this is still over priced and correct price shuld be 700 k
  • I sent email to  info@invest.gov.tr who really replied my queries well but they are being political too so no clear answer as well..  They provided me a link emlakkonut.com.tr which does not help much as it has basic info about each property. Then to apply for citizenship, the offics in turkey needs several visits and knwldge of turkey. The avg fee of a lawyer asking is 3250 USD from start to end but the lawyer wont guide me which is best property.
  • Other thing i noticed is that some of these developements put up a sign saying we are gvt backed, tapu is ready. now the unit is not handed over but tapu is ready. So i think these agents or companies like avengart have tie up with some agents to process all under the table like getting an assesment report in their favor for the price of property. 
  • I did a research on sagenbindan for 1+1 or 2+1 from local market. and concatcted owners or local turkish agents and use google translate to chat on whatsapp and i realize it is MUCH MUCH better to buy a property from secondary market already rented so you know the ROI than going for these new dev projects. But then i need a local turkish expert to negotiate but less price means more rental roi. on the asking price of rents and sell for same properties in areas like levent, nisantase , maslak , gloriya, i found the gross rental yield a 4.1 to 4.3 %. So negotiatate a better price is essential.
  • Buying from local means risks. like is tapu real. will govt assess the value correct? is the tenant rent only to sell me as fake etc etc

Hence i asked all of the questions.   

 

 

Unfortunately only about 15% of foreign property buyers use an independent professional advisor: these are usually investors or people from professions like doctors, who understand the value and necessity of expert guidance. The other 85% of buyers seem to think that they can obtain a little advice free from the internet, and that will be enough. What these buyers don’t understand is that agents have many different misleading tactics and deceptions that they use with buyers several times a day, every day, for years. The buyer may be prepared for one tactic, but the agent has many, and will hook the buyer with one of them.

 

No buyer can possibly educate themselves to every trick and ploy. In this situation the buyer can not possibly win. A professional advisorthat has experience dealing with agents’ tricks everyday for years can win.

 

Tags: Buying Property Turkey

#CitizenshipInvestment #Turkey #CitizenshipbyInvestment #PropertyTurkey #RealEstate


Saturday, May 30, 2020

‘The Guide’ of How to Buy Property in Turkey - Explains ‘What and Why’… Knowing ‘How’ is the Key

The Guide to Buying Property in Turkey - Like a LocalThe Guide...'Buy Like a Local'... How to Find and Invest in Property in Turkey a Safer, Smarter, Better Way...
Finally buyers can now rely on simple guidance on buying procedures used by
locals. Thus avoiding the numerous pitfalls and disastrous outcomes that occur
when foreign buyers of property in Turkey are mislead by English speaking estate
agents, and their glossy websites.

Regrettably, these same misleading procedures are also often followed by lawyers 
and mortgage brokers to which the agents introduce their foreign buyers.  In this
way many, many foreign buyers have completed a purchase without realising the
procedures they have followed would never be accepted by local Turkish buyers.
For good reason, too, most often because the misleading procedures of agents are
designed to minimise the buyers negotiating leverage on price discounts, and
conceal key deficiencies in title, the most common being the lack of habitation
certificates. Eventually the foreign buyers learn about the true market prices, and
the lack of permits, and in both cases, the cost of following English speaking agents’
buying procedures adds up to several thousand Pounds, Dollars or Euros.

Now thankfully,  ‘The Guide to Buying Property in Turkey - Like a Local ‘  describes
 ‘what’ the differences in procedure are, the local way,  and ‘why’ it is so important
to avoid following English speaking agents’ insistence and manipulations to obtain
a ‘reservation deposit’. Ten pages of detail are a must read for anyone and everyone
buying a property in Turkey.
 
A property purchase is a substantial investment, and a buyer that informs themselves
fully at the beginning of the procedure, has made the right first step protecting that
investment, ensuring a favourable outcome at the end. Too often buyers are mesmer-
ised by the many wonderful lifestyle attractions of great food, beautiful natural sur-
roundings, joyous social atmosphere, warm sunny climate, and cheap property with
ample proportions. And these are the circumstances, in which a buyer is tempted
into ignoring the essential procedural details of ‘how’ to buy, which is exactly what
agents are relying upon.
 
The ‘what’ and ‘why’ of buying are fully explained in the ten pages of the guide, 
conveying more than 30 years of insights into managing more than 3,000 property
purchase transactions for foreign buyers in Turkey. Unfortunately, what the Guide
can not do in the ten pages provided is to explain ‘HOW’ to do what is needed. For
the very simple reason that ten pages is simply insufficient to address the very wide
range of tactics and deceptions, applied by agents and their collaborators in law
offices and mortgage banks, for manipulating the trusting, unsuspecting foreign
buyer.  If a buyer isn’t hooked by the first trick an agent uses, the buyer will be
hooked by another, of the many in the agent’s proverbial bag of tricks. No amount
of advance reading and research can adequately guard against this outcome, for the
simple reason that buyers can not know what questions to ask, or what to instruct,
because they do not know what to expect of the situation, and most often only have
only the advice of agents and their collaborating lawyers and mortgage brokers to
consider. So many permutations and variations in the non-standardised nature of
Turkish property permits, title liens and claims, and payment procedures, means
that having done one, two, or three transactions, is not enough to obtain a satisfact-
ory awareness of everything that needs understanding, in the myriad of circumstan-
ces that can unfold for each different property transaction. Despite agents’ earnest
assurances to the contrary... (!!!).  
 
Fortunately, the ‘how’ is best obtained from advice available from independent 
professionals. These transaction managers perform an essential function & service,
scrutinising and directing all aspects of a purchase transaction, and are paid by
astute buyers to look after their best interests, in the detail required. This is often
not the case with lawyers and their conflicted interests, with the agents and develop-
ers that introduced the buyer, being their first allegiance. The temptation of huge
hidden price mark-ups and commissions is simply irresistable, like 'Gold Rush Fever'.
The legal reality is that consumer protection laws in Turkey are weak, and real
estate transactions for foreigners are un-regulated. That means that legal recourse
is limited, and costly. So with some optimism, looking forward to the future will
always be brighter when the needlessly predatory practices of English speaking
estate agents are eradicated from the market. Hopefully, 'The Guide…’ will help that
to happen soon....
Check Out My Profile on Quora...
#BuyPropertyTurkey, #The-Guide-To-Buying-Property-in-Turkey
The Guide to Buying Property in Turkey - Comparison of Buying Procedures : The Agents Way vs The Local  Way

Thursday, October 31, 2019

The Property Market in Turkey: How Local Turks Buy


House hunting on the internet is an ideal way to find property. And Turks in Turkey have special on-line property portals where they go to find properties- there are 2-3 large ones and three or more others that have more than a million properties listed for sale- the whole market. And the portals provide on-site message channels for the buyers to communicate directly with the sellers.

This is the property market in Turkey. It is so well-developed, that there are now several new on-line markets offering variations on the basic theme. To say these markets are ‘popular’ is an understatement: this is now the ‘norm’ for the last five years or more. These markets are where more than 87% of all property in Turkey is bought and sold. Why so much? To put it simply, there is no other way or better way to buy or sell property in Turkey. These are the ‘For Sale by Owner’ on-line property markets in Turkey. These aren’t small experimental fly-by-night start up operations. These are huge business owned by Turkiye’s largest holding companies quoted by NASDAQ on the Istanbul Stock Exchange. This is WHERE and HOW the local Turks buy and sell property in Turkey.

Have a question ? Please ask in the comments below, email me, or ask me on Quora...

Thursday, August 15, 2019

Agents Rely on the Language Barrier to Protect the Illusion of their Way of Business...


The way the ‘foreign’ real estate sector in Turkey operates, is somewhat illusionary. Much of this illusion is fueled by agents and their promotional press, which dominates the English speaking internet search engines: not the Turkish language ones.  And the reasons these English speaking on-line agencies primarily serve only foreigners, is so that they can dictate a business process that is more advantageous for them (at the expense of the foreign buyer or seller). They can demand a deposit in advance from a foreign buyer (and get their commission in advance this way). And these agents can also demand a higher buying price from foreigners, to use as a hidden price 'mark-up' which the foreign seller will never see. At least in the past. 

Not so much now, because there simply are too few foreign buyers (citizenship buyers can not buy from another foreigner). But the agents wait patiently, protecting their ‘way of doing business’, with the English language websites for foreigners that don't speak Turkish. Hoping the foreigners will be 'none the wiser'. Hoping one day the foreign holiday home buyers will return in masses like the good old days.

Wednesday, August 14, 2019


Over recent years the way property is bought and sold in Turkey has changed significantly. With changes in technology, the old ways, of using an agent, are a relic of the past for more than five years: local Turks no longer use agents. Proof of this widely recognized development, is the fact that more than 85% of real estate transactions now originate from on-line ‘for sale by owner’ portals, where buyers and sellers can meet discreetly with messaging, and conduct their transactions without agents. Agents are still there, lurking, but quite often when a buyer discovers a property is being listed and offered by an agent, the buyer just moves on to another property. In this respect the Turkish real estate market is more focused and progressed in moving toward a ‘peer-to-peer’ transaction environment than most developed markets in western countries.

Unfortunately, buyers and sellers from these western countries are not aware that the property market in Turkey has changed in this way. And coming from countries were similar changes are not as progressed, these foreign buyers and sellers have some difficulties in adapting to the changes. This can be seen in the size of the English speaking real estate sector in Turkey. Unlike the much larger domestic Turkish speaking market, the smaller English speaking segment is dominated by English speaking agents: a surprisingly vast number. When searching for real estate in the Turkish language, none of these English speaking agencies are shown; but when searching in English, none of the much larger and dominant real estate portals are shown. 

This is an interesting dichotomy and my blog offers a commentary on what goes on between these two ‘parallel universes’ operating in the same location. Enjoy…!