Buy To Let In Istanbul Is Among World’s Best

There is nothing more frustrating for a buy-to-let investor than static rents. If static rents are getting you down, the case for  turning your attention away from the UK and other European countries towards Istanbul property has never been stronger.

Even the Telegraph included the city amongst its best buy to let cities.

Ask any investor what they want from an investment property and they will probably tell you, “rising rents.” Finding good rental income is what property investment is all about. Capital growth is just the icing on the cake.

However, what you normally see happening in a property market is either rising rents or rising prices. Only rarely do you see both happening at the same time. Yet this happened in Istanbul and several other cities in Turkey in the year to January 2013 according to residential property statistics release by Readin.

Residential rents for existing homes in Istanbul increased by 15.24% while prices for existing homes increased by 19.47% in the same period. Compare this to the UK where rents are expected to rise by just 2% in the same period and there is a strong case for looking east for property which more than pays for itself.

Turkey’s property market has yet to peak and the secret sauce that makes every property market tick is adding more spice to Istanbul’s potential as one of the world’s best buy to let markets.

The availability of finance and the ability to take on loans to buy property is crucial to the long term stability of any property market. Look around in Europe at the moment and you will see banks jittery about lending and cash strapped buyers struggling to raise deposits.

Yet as mortgage have been harder to come by in most European countries, Turkey’s mortgage market has expanded rapidly. This has been helped along by tumbling interest rates that have fallen from more than 20% in 2009 to less than 10%.

This has made borrowing far more affordable for those who aspire to own their own homes in Turkey. The amount of housing loans has increased by a factor of six, from TRY12.4 billion in 2005 to TRY86 billion in 2012.

What makes all this possible of course is a well-managed economy. All the main economic indicators for Turkey have turned green – GDP is predicted to be hitting 4% this year while unemployment continues to fall.

It might be spring in your part of the world, however I like to think of Turkey as a property market in full flower. We are almost certainly entering a long hot summer of growth in Turkey and, more importantly for investors, its most enticing city – Istanbul.

Are you happy with the income you get from buy-to-let? Please leave your comments below:

Kind regards

Brett Tudor
Property Expert

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