Navigating Real Estate Investment in Istanbul, Turkey: A Comprehensive Guide

How can I make real estate investment in Istanbul?

Real estate in Istanbul is a booming sector and over the past 13 years, many people have been flocking to join the table of investors in this intercontinental city.

In order to make an investment in Istanbul, it is crucial to understand the city’s dynamics and different areas, followed by a deep understanding of your purpose and what sort of return on investment you are looking to secure. Therefore, it is recommended to explore the real estate market in Istanbul via a trusted real estate agent who has a wide and inclusive portfolio of several types of properties across the city. In this article, we dive into different questions frequently asked by investors looking to buy real estate in Istanbul and throughout Türkiye.

Can foreigners buy residential property in Istanbul?

Foreign real estate buyers frequently choose Istanbul, the political, social and economic center of Türkiye, as their new resettlement destination. Since 2013, foreigners have purchased more than 400,000 properties in the metropolis.

Accordingly, the answer to the question “Can foreigners buy a home in Istanbul?” is yes, but there are some restrictions to consider.

These limitations are put in place to safeguard national security and guarantee that Turkish citizens are given priority when it comes to interacting with the real estate market. The following are Türkiye’s primary restrictions on foreign ownership of real estate:

• Foreigners cannot purchase real estate in military zones,
• Türkiye prohibits foreigners from purchasing properties occupying more than 30 hectares,
• In locations deemed to be of strategic importance, foreigners are prohibited from purchasing real estate.

Moreover, there are a few things you must do if you are a foreigner interested in purchasing real estate in Istanbul. You must first confirm that none of the restrictions listed above apply to the property you are interested in. Consult the Turkish Environment, Urbanization and Climate Change Ministry to find out how to achieve this task.

The next step is to find a real estate agent who specializes in assisting foreigners while purchasing a property in Türkiye. This will guarantee that you are receiving the best guidance possible and that the transaction is processed seamlessly.

Finally, you must be ready to present the Turkish authorities with some documents. This paperwork usually consists of your passport, visa and proof of financial stability.

Do foreigners pay property taxes in Türkiye?

Yes, foreigners must pay property taxes in Türkiye. Both Turkish nationals and foreigners pay the same fees.

The annual property tax is determined as a percentage of the property’s value, and the rate varies based on the type and location of the property. In Istanbul, for example, the rate for residential property is 0.2%, while the rate for commercial property is 0.4%.

Property taxes are due on Jan. 1 every year and must be paid to the local municipal authority. The majority of properties are taxed, although there are a few exceptions, including real estate owned by foreign governments or nonprofit organizations.

You must register your property with the local municipality if you are a foreigner who owns a house in Türkiye. You may do this by completing a form and sending it in along with some supporting documents, such as your passport, visa, and title deed.

Once your property is registered, you will get an annual tax bill in the mail. Property taxes can be paid online, via mail or in person at the local municipality.

Can you get Turkish citizenship if you buy property in Türkiye?

Yes, foreigners can get Turkish citizenship under Türkiye’s citizenship investment program by making real estate investments. Currently, a $400,000 (TL 10.88 million) minimum investment is required.

If you want to obtain Turkish citizenship by investing, you must:

• Be a non-Turkish national,
• Purchase a property for at least $400,000,
• Not selling the property for three years after getting the citizenship, otherwise, the citizenship will be revoked,
• Successfully complete a criminal background check.

You can apply for Turkish citizenship through the Turkish Ministry of Interior once you have satisfied all of the prerequisites. Typically, the application process takes six to eight months.

There are several advantages to getting Turkish citizenship through investing. For starters, it permits you to live and work in Türkiye without requiring a visa. Secondly, it provides you with access to Turkish health care and education systems. Third, facilitated visa applications allow travel more freely between countries.

If you want to obtain Turkish citizenship through investing, you should make arrangements with a specialized immigration lawyer or counselor. They can assist you in determining your eligibility and guide you through the application process.

Can I get a Turkish residency permit if I buy property in Türkiye?

The answer is yes! Türkiye is a popular foreign investment destination, and one of the most appealing elements of investing in Türkiye is the possibility of obtaining residency. You can apply for a residency permit in Türkiye if you buy a condo, villa, duplex or triplex house of a certain value at the time of purchase, depending on the location of the property.

When purchasing real estate in large cities, the property must be valued at least $75,000. As for small towns, housing investments of at least $50,000 are required.

The application process for a residence permit is relatively easy. The main part of the application includes submitting the following documents:

• A photocopy of your passport,
• A copy of the property’s title deed,
• A medical certificate,
• A criminal background check,
• A duly filled residency permit application form.

The Turkish authorities will review your application after you submit it. The processing period usually takes a few weeks.

You will be awarded a residence permit if your application is approved. This permit is valid for one year and can be renewed for a total of five years.

Purchasing property in Türkiye is an excellent option to get residency in this inviting nation. If you want to learn more, you can also consult a real estate agent or a lawyer who specializes in Turkish property law.

What are the best districts to buy an apartment in Istanbul?

Istanbul is a large metropolis with a rich cultural and historical heritage. It is also an important commercial and tourist destination. Therefore, while looking for a condo in Istanbul, there are several wonderful areas to consider.

The reason for purchasing an apartment in Istanbul will influence the district you choose. If you are buying a condo for investment purposes, you should select an area that has a favorable location, a high percentage of under-construction properties, and a high potential for capital appreciation, such as Fatih, Kağıthane, Küçükçekmece or Büyükçekmece.

If you intend to rent out your flat, you should look for a location that is popular with tourists or business travelers, such as Beyoğlu, Şişli, Kadıköy and Üsküdar.

In case you are purchasing property for permanent residence, you should pick an area featuring accessibility to major transportation lines and amenities like business centers, schools and markets. An example of that can be found in Sarıyer, Beylikdüzü and Avcılar.

What is the average price of properties in Istanbul?

House prices across Istanbul have been consistently increasing in value year after year, showing a positive trend and attracting many investors. Since June 2022, house prices in Istanbul have experienced remarkable growth, with an increase of nearly 100%. The price per square meter, which was $668 in June 2022, now starts at $1,255, reflecting the city’s strong performance in its property market. According to Endeksa, a real estate data analytics and insights platform, house prices will continue to rise in Istanbul, with rates varying from district to district. Two of the main reasons for the rise in prices are the construction cost and the decrease in available plots within the city. The average price for houses for sale in Istanbul stands at $290,000, but this figure may vary across different districts. As you move away from the city center in Istanbul, the prices tend to gradually decrease.

Is it a good idea to buy a house in Türkiye?

According to the Turkish Statistical Institute (TurkStat), as of the first months of 2023, there has been a noticeable decline in the rate of house sales in Türkiye, showing a decrease of 16% compared to the previous year. Specifically, in May 2023, the number of homes sold across the country reached 113,000, reflecting a 7% decrease compared to the same period in the previous year. Also, Istanbul accounted for a significant portion, with 11,000 houses sold in May, representing 10% of the total homes sold in Türkiye during that month.

Despite the decrease in the rate of sales, these findings may offer more optimistic insights for international investors looking to invest in Turkish real estate. Industry experts forecast an annual growth rate of 8% in the Turkish real estate market by 2027. This prediction indicates a positive outlook for potential investors, with the potential for good returns and a stable market.

It’s important to highlight that the appeal of Türkiye as a destination for investors is not only limited to financial considerations. There are different groups within the investor community, each with its own motivations. Some investors are attracted to Türkiye due to its potential as a profitable investment opportunity. Others see it as a vacation destination. Additionally, there is a group of investors who are specifically interested in Türkiye to obtain Turkish citizenship. Therefore, buying a house in Türkiye can be a good choice for various groups of people.

Is it cheap to live in Istanbul?

Istanbul is the most expensive city in Türkiye, resulting in a relatively high cost of living compared to other cities within the country. However, when compared to European, U.S. and Gulf cities, Istanbul is often considered to be more affordable.

The cost of living is commonly determined by comparing the prices of various goods and services that consumers typically spend their money on. These costs can be analyzed across different categories such as health care, housing, food and more. With the data from Numbeo, we created a list encompassing various expenses in Istanbul:

• A Big Mac: $5.50
• 1 kilogram (2 pounds) of chicken breast: $4.65
• 1 kilogram (2 pounds) of tomatoes: $0.89
• 12 eggs: $2
• A bottle of red wine, good quality: $12
• Monthly rent for a one-bedroom apartment, city center: $665
• Monthly rent for a one-bedroom apartment, outside the city center: $440
• Monthly rent for a three-bedroom apartment, city center: $1,180
• Monthly rent for a three-bedroom apartment, outside the city center: $753
• A one-way ticket for local transport: $0.40
• A monthly pass for local transport: $32
• Taxi 1 kilometer: $0.36
• Gasoline (1 liter): $0.92
• Fitness club monthly fee: $21
• Utilities for a one-bedroom apartment: $63
• Internet monthly fee: $10

Is buying a house in Istanbul a good investment?

The real estate market in Istanbul is experiencing steady growth. Factors such as the increasing interest in residential and commercial properties, a rise in annual tourist visits, internal migration and the desire of individuals from different countries to establish businesses and pursue lives in Istanbul have contributed to the thriving real estate market. Consequently, the topic of purchasing a house in Istanbul has gained significant attention.

Investing in your own home in Türkiye, particularly in a dynamic city like Istanbul, grants many advantages with it. One of them is establishing a residence in Istanbul and living there. The other one is the possibility of generating rental income. Istanbul’s high demand in the real estate market creates a favorable environment for finding tenants, regardless of the season. Besides the factors mentioned, there are various pros and cons associated with purchasing a house in Istanbul.

Pros:

• High demand
• Infrastructure developments
• Potential for growth
• Affordable cost of living
• Turkish citizenship

Cons:

• Maintenance cost
• Earthquake risk
• Annual expenses (tax)

How much does an apartment cost in Istanbul?

Determining the price of a house involves considering numerous factors, making it challenging to provide a definitive figure. However, based on the data from Endeksa, the average house price in Istanbul is approximately $290,000, $3,200 per square meter. Istanbul is a big city with many districts. Therefore, prices will change depending on the district the building is located. For example, Sarıyer is the most expensive district in Istanbul with an average house price of $450,000. What makes this district special is the proximity to the natural beauty of Istanbul, such as the Bosporus and Atatürk City Forest, granting a peaceful life to its residents.

Istanbul properties offer various amenities, structure types and different walks of life. It is possible to find many different types of houses from villas to apartments, penthouses and duplex houses. The price will also vary according to the type of house you prefer. For example, the average price of villas in Istanbul is $658,000. That is four times the price of a condo in the city.

The increasing and overflowing population of Istanbul in recent years has led to the expansion of residential areas beyond the city center. This trend has resulted in significant developments in districts that were once considered outskirts but are still part of Istanbul. Districts like Beylikdüzü, Büyükçekmece, Ataşehir and Esenyurt have witnessed substantial real estate projects to meet the increased demand. The majority of residential complexes in these areas prioritize security, parking, gyms and fitness centers, pools and spacious gardens. Despite all these features, these districts are the cheapest districts in Istanbul. Arranged from the most affordable to the most expensive, the square meter prices in some outskirts districts of Istanbul are as follows: Esenyurt with a price of $1,400 per square meter, Beylikdüzü with a price of $2,098 per square meter, Büyükçekmece with a price of $2,300 per square meter and Ataşehir with a price of $4,500 per square meter.

The real estate market in Istanbul presents a wide variety of choices, addressing different preferences and budgets. Whether seeking a peaceful and natural setting or urban conveniences, Istanbul’s districts offer a variety of options to meet the needs of homebuyers and investors.

What are the main districts in Istanbul?

Istanbul is divided into 39 districts, each with its unique character and attractions. Here are some of the main districts:

• Fatih: The historic and touristic heart of Istanbul, Fatih is home to many of the city’s most famous landmarks, including the Hagia Sophia Grand Mosque, the Blue Mosque and Topkapı Palace.
• Beyoğlu: Also known as Pera, Beyoğlu is a vibrant district with a mix of Ottoman and European architecture. It’s home to many popular tourist attractions, such as the Galata Tower, Istiklal Street and Taksim Square.
• Şişli: A modern district, home to many high-rise buildings, luxury hotels and shopping malls. It’s also home to the Atatürk Museum, which is dedicated to the life and work of the founder of the Republic of Türkiye.
• Beşiktaş: A lively district on the European side of the Bosporus, it is home to the Beşiktaş football club, Dolmabahçe Palace and Ortaköy Mosque.
• Kadıköy: A bustling district on the Asian side of the Bosporus, Kadıköy is home to the Moda district, which is popular with young people and artists. It’s also home to the Fenerbahçe football club and the Kadıköy Mosque.
• Üsküdar: The district is home to many historical mosques, palaces and tombs, including the Mihrimah Sultan Mosque, Beylerbeyi Palace, the Küçüksu Palace and Üsküdar Cemetery. It is also a popular tourist destination. The district is known for its beautiful waterfront, its lively bazaars, and its traditional Turkish restaurants. Visitors can enjoy a ferry ride across the Bosporus to Üsküdar, or they can take a walk along the waterfront and enjoy the views of the city.
• Beykoz, on the Anatolian shore of the Bosporus, is known for its historic mansions, its natural beauty and its proximity to the Black Sea.
• Sarıyer is a district on the European side of Istanbul. It is Beykoz’s counterpart on the European side. Sarıyer is a popular tourist destination and is known for its forests, castles and historical sites.
• Küçükçekmece is also a popular shopping destination, with several large shopping malls and markets. The district is also home to many parks and green spaces, making it a great place to relax and enjoy the outdoors.
• Avcılar is a popular residential area and is home to several universities, hospitals and shopping malls. One of the biggest historic attractions of Avcılar is the Roman Baths of Avcılar: A second-century Roman bathhouse that has been restored and is now open to the public.
• Başakşehir, Bahçeşehir and Beylikdüzü are rapidly growing districts, they are great places to live, work and visit. The Turkish government has focused a lot on these districts for the past 15 years in terms of infrastructure and transportation as part of their efforts to relieve pressure from the city center. This allowed thousands of businesses to flourish and emerge in the area.
• Bakırköy and Florya are synonymous with generational wealth and luxury experiences. These two areas are home to many famous restaurants that are members of the La Confrérie de la Chaîne des Rôtisseurs, due to their amazing Turkish cuisine that serves vegans, vegetarians and meat lovers all the same.
• Kartal, on the Asian side of Istanbul, is a coastal district that is currently booming and suitable for investment by purchasing real estate. The city is ground zero for urban regeneration projects as well as new projects.

Where do millionaires live in Istanbul?

Istanbul is a city of contrasts, offering a variety of neighborhoods, from the most luxurious to the most affordable. Istanbul’s millionaires usually prefer staying in the city’s elite areas, including Bebek, Yeniköy and Tarabya on the city’s European side and Beykoz and Anadoluhisarı on its Asian side. These areas are renowned for their magnificent Bosporus scenery, gorgeous houses and upscale amenities.

It is worth noting that a Bosporus view is not the only attraction for millionaires, districts such as Pendik offer houses and villas with private access to beaches, all-inclusive, luxurious construction projects directly on the Marmara Sea with unobstructed views of the Princes’ Islands, are also very attractive for them.

There are many kinds of wealthy people, with different tastes to cater to, some of them find their haven in the Kadıköy district, especially in the Moda neighborhood, as it is a relaxed and easy-going area with thousands of aesthetic old historic buildings.

Who is the richest person living in Istanbul?

There is no “one” richest person living in Istanbul because this city is considered a metropolis and is the home to hundreds if not thousands of world-class millionaires from all over the world from different nationalities. However, to narrow it down, the richest Turkish person that lives in Istanbul with a non-moveable estate that he resides in is Mehmet Emin Karamehmet. This man has a wealth estimated at $4.3 billion from his company Çukurova Holding. Mehmet Emin has a mansion in the Beykoz district on the Asian side of Istanbul, with a helicopter pad and a yacht berthing space on the Bosporus attached to his mansion.

Where do most expats live in Istanbul?

Expats are not located in one place when it comes to Istanbul, they are spread all over the city depending on their workplaces, their financial status, their preferences in everyday life and their surroundings. With nearly 800,000 expats living in Istanbul, there is a trend that is rising among people who work remotely but live in the city. This trend shows us the demographic distribution of these expats, where people between the ages of 22-32 generally prefer the city center, such as Beyoğlu, Kadıköy, Şişli and Nişantaşı, as these areas are close to all the nightlife, all the celebrities and the walking distances to every place that they might want to visit. On the other hand, married people over the age of 33 prefer living in areas such as Bahçeşehir, Başakşehir and Beylikdüzü. These areas are family friendly with lots of amenities and organic markets that are more appealing to someone who wants to visit the center occasionally but stay away from the noise at the same time.

Where are the best sea-view condos in Istanbul?

Being a city surrounded by water from the Marmara Sea, the Black Sea and the Bosporus, there are many property construction projects with breathtaking sea views. These condos range from affordable condos, suitable for Turkish citizenship, in the Silivri area on the far west European side of Istanbul all the way to ultra-lux apartments in skyscrapers in Sarıyer with a full Bosporus and bridges view. However, by popular vote at Istanbul Property, the favorite and best sea-view apartments are in Kartal on the Asian side and in Zeytinburnu on the European side across from Kennedy Street.

These two areas are coastal districts, that have full sea views with either cargo ships or Princes’ Islands adorning the view with their green contrast against the blue waters and the changing skies throughout the years. Apartments in these areas usually enjoy panoramic views, as the developers understand the importance of ceiling-to-floor glass walls facing this breathtaking view.

Where can I find luxury villas in Istanbul?

Taking into consideration that Istanbul is one of the world’s metropoles, you must always keep in mind that it is not possible to find luxurious villa options with a huge piece of land to host your guests inside the border of the city center districts (Beyoğlu, Şişli, Kağıthane or Zeytinburnu); however, the vast green spaces in areas such as Beykoz, Maslak, Üsküdar, Büyükçekmece, Beylikdüzü and Şile on the Black Sea, one can find villas that are on a completely different level of the villas across the world and can only be compared to their counterparts in Thailand, Malibu and the Caribbean islands. A villa in Istanbul is the ideal option if you want a truly luxurious and private spot to call home.

There are two types of luxury villas in Istanbul, the first is a normal luxury villa with a huge piece of land, overlooking the Marmara Sea, the Black Sea or the Bosporus. And the other type is something called a “Yalı” villa. Yalı is the Turkish word for “waterside,” this refers to villas and mansions that are directly on a body of water, nevertheless, the word “yalı” in Istanbul is reserved for villas that are located directly on the Bosporus. These homes are usually located in Beykoz, Maslak, Üsküdar, Kadıköy and Bebek.

There are many choices for luxurious villas across Istanbul, and in order to get really good options that suit your vision, you must do your research with an agency that has a good portfolio and trustable sources without hidden fees.