Istanbul Property – It’s A Lot Better Than Money In The Bank

I returned from a busy trip to Istanbul this week to hear news that the UK property market is unlikely to reach its 2007 peak until 2019 and 320,000 NS&I Isa savers will see their rate drop from 2.5% to 2.25% with immediate effect.

I also heard President Obama saying on the news that the best is yet to come. This might be good news for a lot of Americans but what about Europe? Fortunately there is still a place on the continent where you can get the best of what’s to come now and avoid having to endure, poor returns on your savings and gloomy news about property markets.

That place is Istanbul or more specifically Istanbul property as I discovered on my tour of the best new property developments in the city. I recommend spending some time in this eastern powerhouse of a city to get a feel for where the market is at. I can tell you I was not disappointed.

One of my regrets on this particular journey around Istanbul was I hardly got any time to enjoy the cool of the evening in the city’s many bars and restaurants. I needed to work around the clock to find out where the best locations to invest in property are in this vast city.

There are of course bad areas away from the centre as with any other city, however there are also certain micro-markets that are growing at a furious pace at the moment. These are driven by foreign investment, local demand for property in good areas and a strong, growing national economy, to which Istanbul, like London in the UK, contributes the lion’s share of this economic growth.

Areas such as the super suburb of Beylikduzu have been a property investors dream in recent years with prices rising 30% from off-plan to completion within a period of just 18 months. Not unusual in a city that has seen a doubling of the prices per square metre from £1,244 to £2,800 in 7 years.

Unlike most many established European economies like France, Spain and Italy, even the credit ratings agencies are starting to notice the potential of Turkey and this is largely due to the emergence of Istanbul as one of THE places to invest in Europe.

Fitch lifted Turkey’s long term currency debt to BBB- from BB+. This is significant, given the ratings agencies harsh treatment of Turkey over the years. If even the ratings agencies are taking notice, then you know Turkey must be well and truly getting its act together.

Can you say the same thing about your bank? The problem is keeping all your money in a bank account these days is likely to lose your money to that silent killer – inflation. The question is if someone offered you 10% on your money every year and another 7% on top in payment would you say “no, I would prefer 2.5% or possibly less” instead?

Well will you be investing for the best return? Please leave your comments below.

 

Kind regards
Loxley McKenzie

 

Managing Director

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