Why Turkey?

I think the next few years could be quite interesting in Turkey.

IMO the charade over EU membership will finally come to an end in that period - It simply aint gonna happen in my lifetime - too many issues to be overcome by both Turkey and the existing EU membership.

I think Romania and Bulgaria will be last new members of the union for quite sometime unless Norway or Switzerland decide to join. Everybody recognises now that the EU bit off more than it could chew in fast fowarding in 2004 and until there is a new constitution and the new members are finally bedded down there will be no further expansion.

Turkey has had customs union and associate membership going back to the 60's and nothing will change that - if anything the economic ties will grow deeper but full membership is a non-runner . The only reason it has been entertained to date has been relentless pressure from Washington to "reward" Turkey for its not inconsiderable social and economic advances over the last decade , thus ensuring the total hostility of the French to the whole project (prejudice aside , maybe the French have a point - at the same time as the US has been urging Turkish EU membership - its been actively building fences along the mexican border! hmmm).Fear and Suspicion over Islam post 9/11 , Europe's own troubles over trying to integrate the already sizable muslim minorites within its own borders , The Cyprus issue ,Turkey's reluctance to fess up to past sins (a vital condition to EU membership) like the Armenian question and other minorities where it has not covered itself in glory and growing rumbles from the Military - the real power in Turkey - will ensure the current membership drive will run into the sand in the next 12-24 months.

On the plus side ,I dont think the collapse of EU membership will have a massively detrimental effect on Turkey's economy . Many Turks have already come to this conclusion and are prepared for this.Turkey will benefit from many of the structural and governmental changes put in place in the drive for EU membership, particularly in regard to corruption and privatisation ,in a Globalized economy this is vital. Turkey will start to look more to its Asian and Middle Eastern Hinterland and if the Iraq Fiasco can stay contained within its own borders (it must be said - a big if - the Yanks are now sobering up to the fact that they have opened a Pandora's Box there) , the future could be good for Turkey surrounded as it is with Oil and resource rich neighbours.

bearing this in mind - Istanbul , particularly on the European side of the Bosporus would be a good place to invest . Ankara and Izmir too as thriving commerical and industrial centres, for the right money. The holiday resorts have been overcooked in recent years - a lot of haphazard , hurried construction with utilities and services trailing a long way behind (like ourselves) - I would stay away. Too expensive for the potential yield - limited summer season - May to October - the eastern Med north of cyprus is cold cold cold in the Winter - its definitely not Spain and its a good 4/5 hour flight from here - and its questionable what sort of air services will be available in the winter aswell. With question marks and turbulence coming over the temporary end of the EU dream the capital appreciation that has marked the last 10 years will ebb away as the market sobers up and dreamers go chasing the next big thing elsewhere. But as AUTO says - if you do your homework and are realistic in your expectations and are prepared to think long term, know when to hold and when to fold I think there are opportunities in Turkey.

My 2 cents.
 
thanks edo; good constructive post. agree with the military being the real power. and if the eu membership turns out to be a non runner, I can see the military flexing their muscles a little bit more than of late. they are the main upholders of the secular state, not the political party currently in power. agree too about the airports in winter, unless you are willing to go to luton or gatwick etc for the first leg. and british airports as a transit point are not for the faint hearted at present. and there is the earthquake factor but apparantly not in alanya where a lot of the paddys have bought. and while the winter in alanya might be mild compared with the west coast the summers can be the other extreme.
 
There are direct flights to Istanbul started early this year. Twice week and maybe three times in the near future. Domestic flights are cheap and good all year around. Why Turkey? Think of drinking malibu on the beach day time soaking up the sun. An hour drive you can be drinking brandy and skiing at night. Where? Antalya.

Istanbul is the best place to invest in Turkey. Easy all year around renting.
 
GtaSa said:
There are direct flights to Istanbul started early this year. Twice week and maybe three times in the near future. Domestic flights are cheap and good all year around. Why Turkey? Think of drinking malibu on the beach day time soaking up the sun. An hour drive you can be drinking brandy and skiing at night. Where? Antalya.

Istanbul is the best place to invest in Turkey. Easy all year around renting.
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Yes, Istanbul is the best of a very bad lot from an investment point of view. Apart from the basket case government, the Kurdish issue, the human rights abuses, and other instability, the Eu membership issue is now well and truly dead in the water. What this will do to the currency over the next 5 years is anyone's guess. Guessing however isn't part of an investment strategy, and Turkey is a no-no for anyone who can't afford to lose money.

As for the beach resorts, these are well overpriced, and look set for a reality check over the next few years. In addition, the "guaranteed rental" scam has taken root here, although not as seriously as in Bulgaria for instance, and a lot of buyers are going to find out that they did not get what they thought they had bought.

As for access, its a pain in the rear off season, but for good reason. Have you ever seen the rain in Kusadasi in wintertime? The reason there ar eno flights is not some conspiracy by the airlines, there is no demand. Nobody wants to go there off season (except the people who pay the guaranteed rents, and they don't need planes!).

As for skiing in the morning and beach at night, you can do that more easily on the Cotra del Sol, 2 hours from Dublin, but in reality almost nobody wants this option. If you go skiing, you go skiing; if you want good weather in wintertime, go to Spain.

Turkey? Never was a country so well named form an investor perspective!
 
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Auto, your criteria in rubbishing Turkey doesn't really help, as it rules out a lot of countries, including Spain. Human rights (arrests of Basque and Catalan politicans-and issues with the same ethnic groups, torture and unresolved issues from the civil war), a government continually undecided as to who their master is, massive problems with illegal immigrants, not to mention huge sums of money wasted/spent on same, other instability - closing industries, disgraceful pollution problems (Malaga being a case in point). When dropping the boom on a country, we have to be sure that we don't immediately rule out or have to gloss over countries that we'd promote.
 
"the Eu membership issue is now well and truly dead in the water" (auto)
and thanks God that it is, now we can get on with life. It was the best thing happen to the currency. With foreign currency savings accounts reaching 23 Billion dollar it looks more promising then ever.
On the Kurdish issue; there was a boycott campaign ran against holidaying in Turkey in the UK in 1994, nearly one million Kurds lost their jobs that summer. Clever action.
I do agree that beach resorts being well overpriced so are they all over Europe.
Guaranteed rental scam can be a good test the buyer can use, rental guarantee-beach resort=no, nor rental guarantee=modest short term rent return. Of course one can always hand over the property to a well known travel agency for renting for the %30-40 of the anticipated rental income and let them rip you off instead of the lausy local developer, right?
It is a horrific idea that it rains buckets in a city in the winter, absolutaly horrific.
 
plasticpaddy said:
"the Eu membership issue is now well and truly dead in the water" (auto)
and thanks God that it is, now we can get on with life. It was the best thing happen to the currency. With foreign currency savings accounts reaching 23 Billion dollar it looks more promising then ever.
On the Kurdish issue; there was a boycott campaign ran against holidaying in Turkey in the UK in 1994, nearly one million Kurds lost their jobs that summer. Clever action.
I do agree that beach resorts being well overpriced so are they all over Europe.
Guaranteed rental scam can be a good test the buyer can use, rental guarantee-beach resort=no, nor rental guarantee=modest short term rent return. Of course one can always hand over the property to a well known travel agency for renting for the %30-40 of the anticipated rental income and let them rip you off instead of the lausy local developer, right?
It is a horrific idea that it rains buckets in a city in the winter, absolutaly horrific.
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PlasticPaddy - what the blazes is your point here?

All that the above looks to me is a anti European rant tinged with a fair degree of sarcasm.

you mighn't agree with the points being put forward by some of the posters here - but at least come back with something approaching a considered and coherent rebuttal.

I can see pros and cons with investing in Turkey in foreseeable future - AUTO is definitely negative on the issue ,but he makes his points clearly and eloquently and I can see exactly where he is coming from and what he is contributing to this debate.

So - from what I can make out you are turkish or a definite Turkophile with some knowledge of the country - so elaborate a little and give me some good reasons to change my euros into lira.

Edo
 
Eurosceptic in the sense anti EU yes, anti European,no. I see no benefit in becoming a member of the union for Turkey. But this beside our point. Sorry for sarcasm, I did not find Auto's latest post eloquent, although as you said he has made good contributions. In terms of constructive contribution I have given as much information as I had about buying in the country and have done more Turkey bashing then anybody else have done thus far in my previous posts. It would be best if we can go back to the context. I did say I was Turkish, I am also Irish, a quarter Kurdish and a quarter Georgian-Armenian(I am not being sarcastic) how would that effect anything, is mystery to me.
 
The comments on this website seem to be based on an Islamaphobic view than anything to do with investment. The fact is that property prices have more than doubled in Istanbul over the last 3-4 years - long before EU accession seemed even possible. The government is working hard to deal with the human rights issues but these will take time to change.

From an economic point of view Istanbul is a major commercial centre with a population that has quarupled in 25 years. The demand for housing outstrips the available supply by a fairly wide margin and this trend is expected to continue. Also, Turkey is at the junction between Europe and the Middle East and has strong links with the fast growing Central Asian economies also. Contrary to some of the previous posts most of the major investment banks have already established a presence there and when I was there a few weeks ago there was a lot of talk about various pension funds and investment funds from Britain and the middle east snapping up huge chunks of the city particularly around the old city. The property market has benefited from a programme of economic reform and there is nothing to suggest that this wont continue because of EU accession anxieties.

There has been a long toleration of other religions and history shows that when the Europeans were killing miniorities, particulalry the jews, Istanbul provided a safe haven. There may still be problems with the Kurdish issue but what country doesnt experience issues like this that have to be dealt with. At least the government recognises this as an issue that has to be dealt with.

The city centre is modern, cosmopolitan and wealthy with Louis Vuitton, Guichi, Harvey Nicholls etc etc all opening stores there. There is an excellent nightlife, lots of clubs, cafes, bars and restaurants. I was there at the end of ramadan and whilst some people fasted, the restaurants and bars seemed to be as busy as any other time of the year.

I saw some off-plan properties with [broken link removed] and http://www.dqdx.co.uk and both companies were extremely professional, informative, enthusiastic but not at all pushy. Noone said a thing about rental guarantees, both companies were realistic rather than optimistic about possible gains, provided cautious advice about the risks and I never once felt like I was being backed into a corner. When I suggested I might be more interested in older properties in the city centre both companies were extremely helpful in terms of helping me meet some other estate agents even though neither has any business in this area. The older properties I saw dated back to hundreds of years ago and were right in the heart of the retail centre of the city and cost less than US$1000 per sq m - not many places you could say the same thing about elsewhere in Europe. The return flight cost me less than £50 with easyjet and they fly, if I remember correctly, 6 days a week right throughout the year.

I havent made my own decision yet but I hate to read this provincial bigoted nonsense based on some self proclaimed expert's so called analysis. Believe me if you are serious about investing look at the analysis of the economic fundamentals from the OECD/IMF, visit the city, study the market and examine the trends - dont make investment decisions based on some half-baked religious/cultural phobia.

Riga, Sofia and Bucharest are quaint backwaters and although they are fashionable now it is hard to see how these prices can be sustainable given the demographics and economic factors evident in all three countries.
 
plasticpaddy; in your opinion,as a returned Turkish citizen. now living in Turkey, would an Irish person have any reason to fear a more muslim extremist government in the future? is there any liklihood of Turkey 'turning in' and resentment to foreigners living in ( relative) comfort and using the countrys amenities ( beaches, mountains, cheap eating out etc) while the local unemployment is 20% and then returning home during the winter periods, thus not creating permanent employment for locals?also the east of the country is different from the west ( huge country I know) and probably more conservative than the western end. How does the government marry spending money on infastructure where 'westerers' are buying apartments and the need to spend more money on the eastern end of the country and does spending such money iritate ordinary Turkish citizens, who are seeing strangers basically purchasing property which the average citizen can not yet afford? I appreciate that this Turkish government, although probably more muslim in outlook that previous ones have steadied the economy and are probably putting a lot of store in the tourist industry, which up to now has been pretty patchy compared with Spain and Portugal, or indeed France and Ireland. understand it is only your opinion but you are on the ground so to speak.
 
auto320 said:
Yes, Istanbul is the best of a very bad lot from an investment point of view. Apart from the basket case government, the Kurdish issue, the human rights abuses, and other instability, the Eu membership issue is now well and truly dead in the water. What this will do to the currency over the next 5 years is anyone's guess. Guessing however isn't part of an investment strategy, and Turkey is a no-no for anyone who can't afford to lose money.

!
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Auto, I feel you know very little about investment and are spouting a lot of xenophobic sentiment.

Let's see:

The "basket case government" has been roundly praise by the leading figures of the financial press eg the FT, the Economist and has been lauded by the IMF as presenting a modern-day economic miracle.

The human rights abuses and the Kurdish issue are not investment considerations last time I looked at how capital markets operate and as for EU membership, again the markets hardly care with Lehman Bros last week claiming it was a breath of fresh air that the EU was on the back burner as investors don't give a TOSS.

Your comments about currency movements betray a lack of macroeconomic training and your views on investment as a whole owe more to myopic jingoism than any formal idea of how capital flows operate. You should really think carefully before you comment on technical subjects such as investment without having properly considered the issues.

Turkey's growth is triple the EU average, it is attracting more foreign direct investment than even India and by far attracts the most among the emerging markets in Europe, its economy has been widely praised for prudent management and reforms look to be long-term and presage stability.

All indicators point to an extremely favourable investment climate. The Dubai government (not known for its liking of risk) is investing £5bn in Turkey - it is being advised by the major investment banks in the City in this strategy - clearly you know something they don't.
 
Cuchulain:We need to define "extremist"first, and who defines it. A political party, group etc. may want to run this country in accordence with the rules of Islam (a religion) and that is OK as a view for me, I would not like it or would not want to live in it but there is nothing extreme about it, if majority choose to do so without any wrongdoing, manupulation or pressure with their free will. That is what is missing in the picture in Turkey. BJP ruled India for a decade, our schools are run by the catholic church in Ireland, examples are many and not totally negative either.

-The government in place is politically Islamist (extremist in the widely used sense in Europe), I prefer the opposite, so it is already there, but I see no danger of a sheria regime in this country. Turks voted for AKP (and only %23) in the hope of a better economy and they got it, it has never been so promising.

-Societies' approach to settlement of Europeans in this country is quite different then your understandable concerns, this immigration is actually creating direct and indirect employement and it is welcomed for a good period to come. Resentment is hypothetically possible, Although there has not been any negative noise about this thus far. Infra-structure is actualy much better in parts in the East, North and East-Midlands then on the coasts (from where all traditional conservative parties gather their votes) . The spending that irrate Turks the most is the military spending, eating up to %65 percent of country's annual budget, the figure spent on Tourism development is a fraction of it and it is widely welcomed. A government who invests in tourism ought to be clever enough to invest in the image of this country as a modern and vibrant place politically as well.
The number of foreigners who purchased holiday homes is still a fraction of the total coastal figure, more then %80 percent of properties on the coasts are owned by Turks and sold to Turks. So Turks need to worry more in that front.
Overall, resenment of havenot's against have's is a just phenomenon, but I view this society more civilized, politically and economically informed;the general concerns you expressed are only hypothetically possible in my opinion. All these concerns about Turkey only helped to improve the economy, political life and so on.Hope I cleared some air for you. Thanks again to all posters.
 
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Could not help to post this, appearently a number of Polish MPs put a proposal to the parliement to declare This post will be deleted if not edited immediately a King , details can be found reuters etc. Would like to see how would that effect foreign investors to Krakov, if the vote is yes.
 
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Can we get something straight here?

I have no axe to grind about Turkey, I don't own property there, don't have any business connections that cloud my judgement about investing or not investing there.

As I said already, there is investment potential in Istanbul if you are well clued in on the local scene, just as there is potential almost anywhere if you know the ground very well. That doesn't apply to the average Irish buyer lining up at a property exhibition with his or her deposit at the ready.

However, for Irish buyers who want to invest in Turkey, this almost without exception means buying seaside properties along the Aegean and Mediterranean coast. That is the reality; 99% of the people I meet who have bought or are buying in Turkey have gone that route.

These properties, with a few exceptions, represent a very poor investment. They are for the most part overpriced and located in places that are hard to get to off-season. They are marketed on the basis that EU entry will boost prices, or that the rents will cover repayments. Both marketing pitches are an absolute fiction.

I am neither racist nor xenophobic, I look at all these issues purely on the basis of return on capital. I stand over my comments that the majority of irish buyers will catch a cold with their "investments" in Turkey.

No doubt plenty of thinly veiled pluggers for the dying Turkish property boom will say dfferently, but it's a free country (which is more than can be said for Turkey by the way).
 
Auto: generally I agree with your posts. sometimes I don't. I know I am asking a lot of questions about Turkey and thats becaue it won't be an investment but a holiday apartment, pure and simple that I might (or might not) purchase. I am not an economist but I imagine that if a country prospers one of the knock on effects is that more people borrow and buy their own property. asaik Turkey only has a mortgage system in place for a year or two. the borrowing rate is very very high by eu standards. I don't know how the Turkish government house their population ie the equivelant of our council estates or the equivelant of the old eastern block communist style blocks, but I would imagine that in a growing economy more Turkish citizens would aspire to own their own property. Probably not on the coast I agree. With a population of 70m and a growing economy and now for the first time access to mortgages I would be surprised if property didn't rise in value. again not necessarily on the coasts but longer term this too might rise from its current price. everything is revelant I know. what you pay €200,000 for in Spain is readily available in Turkey for under half of that. as you have stated though for us Paddys its not easy getting there and this is definitely a consideration. Plasticpaddy; thanks for your reply. I know this particular government have been pretty successful in turning around an economy pretty much on it's knees. and I don't think the Turkish people are extremists. quite the reverse in my view. like us paddys. we might be (mostly) christians but we commit the odd sin. Turks might be muslim but they enjoy the odd drink. The only thing that I didn't enjoy about Istanbul was the way (particularly under the Galata Bridge) you couldn't walk 5 yards without someone trying to get you to either buy something or eat something. Suppose it will pass as more tourists visit and it is one smashing city to visit.
 
Cuchulainn: You seem to find a good balance of pros and cons. Flights off season from Ireland is an important point if you want access to your property all year around and I dont think there will be direct flights to South and West from Ireland (There is to İstanbul everyday from Dublin)for a foreseeable future. But if you are buying to have say 3-5 months access (charters to Antlaya, Bodrum, Dalaman and Izmir from Ireland operate from May to October) go for it, but do your bargain, prices vary a lot, make sure you demand a good furnuture pack or a good discount (feel free to request up to %15 of the value of the property and stick to your guns), stay away from places where you have to pay maintanance charges, isolated off-town projects and rental guarantees unless it is İstanbul. For a place you are not in hurry to sell, you might be laghing in 3-5 years time.You can also buy directly from owners there are couple of good websites operating in English.
Having lived in Ireland I would have to agree with Auto here in terms of access though. It is a good feeling to be able to hop on a plane on your rainy bank holiday in October.
Mortgage system does not seem to happen in the short term,simply because the IMF and the banks do not want it, interest rates have to drop and they dont want it.I would not count on it.
The state simple does not house its population. There is an affordable housing scheme (yes, spot on, apartment blocks, wee better quality and spirit) run by local governments where you pay your house in installements but the demand and need are well in excess of provision. House prices will continiue rising for a good while, but it has reached a plato on the coasts it looks like %12 forecast is avarage one can expect for a few more years.
I do find tauting very annoying myself, it is everywhere, this country is well used to tourism for the last 4 decades, we do not seem to learn, specially the tourism and construction industry employers, real culprits of tauting. Good luck with your hunting.
Happy christmas to all.
 
Hey Plastic you have got it wrong about the government. Turkey is first and foremost a secular state - it is the defining characteristic. It is true the ruling party's origins are rooted in a form of political Islam but this is the sufi strain of Islam which is as far away from extremist as it is possible to be. To the best of my knowlege their origins were in providing food and charity for the poor and other vulnerable members of society. That is why they became so popular with the masses. There is absolutely no agenda to bring in sharia law or anything even resembling it nor has there ever been. Actually someone mentioned it earlier but culturally Turkey sometimes reminds me of my visits to Ireland more than its middle east neighbours although obviously there are similarities there too. On the whole people are friendly and have a real respect for others and although they might go to the mosque once on a week they also know how to kick off and enjoy themselves on a friday night. I cant think of any example of turkish people forcing others to do something against their wishes. In Istanbul you see women wearing veils meeting women who are dressed like they are on their way to a west end nightclub and noone seems to be bothered. Politically speaking there is lots of change although shifting tectonic plates sometimes make it difficult for the government there to implement its full reform package as I unerstand it because as ever there are so many third parties with vested interests in the status quo which have to be dealt with first. However, there is a clear agenda coupled with continued economic reform to liberalise and modernise the economy and this has really transformed the country and in most cases for the better. The major downside is that Turkey is four hours away, there are not a lot of english speakers in Istanbul as I saw it and the reforms process is not complete or irrevesrible at the minute. These may be sticking points for me but none of these factors are deal-breakers as I see it. If the reforms continue as before Turkey has the potential to become a real powerhouse between Europe and Asia and it is this that attracts me as an investment opportunity. If everything goes to plan the Turkish economy could take on the tiger mantle very soon and I wouldnt mind being right in there from the start.
 
Londonaj, although it is refreshing to hear praise rather then the traditional bashing of this place and its people, I would be more cauteous about the government in place. The state is secular and the constitution is godless and all, military versus Islam is what bothers me. This government got %23 of the votes a considearble portion of which came from Kurdish population who justly flex their voting muscle when it suits them, that is hardly reflective of general political opinion. But we have a very confused voter in hand feeling no alternative to AKP, so it looks like they will come back as a bigger power. Sufism is another story not for an overseas property investment forum, personally it gives me shivers to think this crowd has anything to do with sufism, a selective aid system to vulnarable (i.e. shutting down the womens' shelters and drug treatment centres in major municipalities) hardly counts for sufism, helping the vulnarable is a part of culture in most poor societies more so then the better off ones. But I am aware they use the biggest PR agents in the country and Europe and some spin doctor whispered sufism to their ears during their election campaign.The economy is doing quite well, but I am a realist, the tiger is yet to come; Turkey has a serious black economy and corruption problem which even the best of the governments (including AKP) seem not to be able to avoid sinking in it up to their necks,Turkey has a serious International drug-arms and human trade problem, Turkey has a serious military spending problem and Turkey has a serious state machinery problem to count a few major ones. I have seen the tiger creating the biggest gap between rich and poor in Ireland as the marjinalised groups (such as elderly) become poorer, so personally I would not like this country to aspire to Irish recovery, but it does, like the rest of Eastern Europe and further. I would agree though with most of your points only with more caution.
 
Everything said here is very interesting and all that, but the point to remember is that this board is about property "investment". If you buy a property as currently marketed by almost anyone selling on the coast, it will cost you at least twice what it is worth. What it is worth is what people will pay for it if you put it back on the market, not what a high-powreed salesman tells you it will be worth.

Sure, if the Turkish economy ever brings wages and salaries up to Irish levels, people will pay more for houses, but not at the same level as here because of supply/demand differences between the two places. Assuming that this does happen, you will achieve a return on capital (this about investment, don't forget) only if you paid the right price in the first place.

As for use solely as holiday home, it still makes no sense to pay twice the true value. Even the purcahse of a holiday home should be done with an eventual eye to selling on should your circumstances change.

That is why I still say Spain for holiday homes; acess, access and access, as well as good homes from less than 100k that can be got to in a couple of hours all year round. I dont sell property in Spain, but I love the palce and spend a lot of time there. No contest in my view.
 
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