Turkish Mortgage system and Loans

Mortgage Process in Turkey

2011-04-25T13:50:00.002+02:00

The Turkey mortgage process in Turkey, is very similar to the majority of many other
countries but can be at times slow, due to the Turkish legal and administration
system. If you have found a property in Turkey and made a deposit, we would
advise that you contact us as soon as possible. Our advice and mortgage quote
service is free of charge and you are under no obligation. You should be aware
that property purchased in Turkey, especially raising of Turkish finance, can be
more complicated and time consuming, therefore we would recommend that you start
the mortgage process as early as possible to avoid such delays and make the
buying process as smooth as possible. Obtaining an acceptance for a mortgage,
will give you the head start you need to purchase a property, this service can
be arranged whether you have yet to visit Turkey. Once an acceptance has been
completed, you will know the range of property values you will be able to
purchase at and place an offer, confidently knowing that you can raise the
necessary finance to support this. Once an offer has been accepted on a property
and the sale agreed, the initial sale of contract is draw up, a contract is
normally drawn up, which would include the price, completion date and any other
relevant information for the sale. An application of transfer is then made to
the land registry, with deposits being paid, legal documents being drawn up,
local tax numbers being registered.

The property is also valued and the mortgage
application reaches final sign off with the appropriate lender, with the
mortgage offer being released and the property completion date being set,
subject to the title deed transfer timescale, as the title deeds need to be in
the same names as the mortgage application. If you are purchasing a property
“Off Plan” a mortgage can only be raised by completion of the property, however
you are still able to apply for the funds and have the mortgage offer in
writing, but the final survey will not take place and funds will not be made
available until the property has been completed and fully inspected by the
lender concerned. Please note that in all cases you will need to have been
granted clearance to purchase your property from the Turkish Ministry of
Defence. Usually your vendor will apply for this so make sure you are not short
changed in any of your negotiations.

Turkish home loan market

2011-04-19T21:20:00.001+02:00

Mortgage regulations increase the value of the Turkish home loan market

Despite the presence of mortgage regulations in Turkey, there is no reason for an investor to be afraid about investing on a property through loan mortgage. In fact, as the market progresses, investors are given the chance to use the gearing technique.

Gearing is a method that can help anybody who looks for higher returns on investment. Simply put, if you eye to purchase a property worth £200,000 with 50% taken from home loan, there is a chance for you to gain more once the property appreciates in by 10% in a year’s time. Doing the math, you may gain as much as £20,000 or 20% out of your £100,000 initial investment.

What makes the Turkish home loan market boom?

Aside from tourism and affordability of properties on Turkish grounds, there are yet other reasons for foreign investors who want to enter into the loan market scenario. Turkey is accessible most especially to the United Kingdom with only four to five hours of travel using Turkish airports. Additionally, every person can acquire a home not only in areas situated near the beach but even in the rural areas.

Rural properties in Turkey are eyed by investors because of the cheaper prices attached to them. With this, it really does not matter where you buy a Turkish property. As long as you enjoy the country at its best, your home loan will be paid for not only in monetary terms but in aesthetical pleasures.

Turkish Home Loan Market Saved

2011-04-19T21:16:00.000+02:00

Has the Turkish Home Loan Market Saved Because No Mortgage Regulations was In Place?

A lot of foreign investors are contemplating on renting up a property on Turkish grounds. This is basically because of the real value of the place especially when it comes to tourism. The country is a good combination of big beach resorts and a favourable climate. An added advantage that foreign investors see is the fact that homes are reasonably priced. With all these facts about Turkey, everybody seems to be interested in signing up a home loan in any of the banks or financial institutions offering one.

Developments of various properties in the place are considered budget-friendly. This being so, investors both from within and outside the nation are taking their chances on investing on home loan. But, is it true that the Turkish home loan market was put aside because there were no concrete mortgage regulations in the place?

The real scenario in Turkish home loan market

The Turkish mortgage regulation was supposed to provide tax incentives to mortgagors. These tax incentives are now utilized in order to develop the primary and secondary mortgage markets in the country.

Mortgage regulations in Turkey are not to be taken as an opportunity to raise the fair market value of Turkish properties offered in the loan mortgage market. If this happens, prospects of the said market – especially foreign investors – may back out from the project. This may even be a cause of another problem when selling mortgage bonds to countries like the USA.

How did Turkey solve the home loan problem coinciding with mortgage regulations?

Turkey must be very thankful with the presence of big construction companies who helped develop new projects just after the mortgage regulations have been implemented. These projects led to the decrease of home prices and are now available for loan. Effortlessly, the government as well as project proponents are able to sell the homes to various investors.

Of course, the country continued to flourish in terms of tourism. In fact, Kusadasi and Fethiye on the west continue to be recognized worldwide because of its well-known resorts. Smaller beach towns like the Aegean and Mediterranean Region are not left lagging behind. For anyone who continues to search for mortgaged property in Turkey, Antalya and Side at the southern part are popular choices.

Kusadasi Real Estate

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Year after year, people invest in Kusadasi Real Estate. Kusadasi is a famous town resort in Turkey which is visited by thousands of tourist from Spain, Ireland, England and Germany. Visitors and tourists experience a memorable holiday in Kusadasi where the sun shines 300 days a year. Kusadasi has an incredible culture and clear beaches. During the summer season Kusadasi's population of 50, 000 increases to almost half a million. Kusadasi is known for its cultural and historical sites. There is the Didyma, Ephesus, The house of the Virgin Mary, The temple of Artemis and the Odeion just to name a few.

Living in Kusadasi is inexpensive. This is favorable to one who wants to own a real estate in Kusadasi, Turkey. Owning a Kusadasi real estate is good for investment. Real estate is high in demand and prices are low. What's good in owning a real estate in Kusadasi is because the price of property is increasing every year. If you are an investor and want to buy a few properties like villas and cottages in Kusadasi, you will absolutely benefit from it especially during the summer and the whole year round. Most villas and cottages are being rented by tourists who plan to stay long in Kusadasi. Hotels, villas, apartments, restaurants, bars and cafes are good investments because you can generate big income when you invest in Kusadasi. Kusadasi real estate prices ranges from 20, 000 pounds to 100, 000 pounds and above.

Kusadasi Real Estate is the best you can get nowadays especially that summer is fast approaching. You can have your property rented to tourists during the summer season. Think about the income you will be generating from this. Or if you love traveling then own a summer house in Kusadasi and visit it as often as you want. Whether you want to invest in a small hotel, a villa, an apartment or buy your dream house in Kusadasi, you will definitely get your money's worth because Kusadasi is a paradise on Earth. Business or pleasure, Kusadasi Real Estate is the best for you.

Prediction on Investment Property in Turkey

2008-04-07T00:54:00.000+02:00

One of the most lucrative ventures today is investment property in Turkey. The future of real estate investment in Turkey is predicted to be more profitable than investment elsewhere since the country has shown signs of growth and development these past few years. There are four major reasons why Turkey is the best place in the map to invest real property:
1. its economic integration process,
2. its drastic effort to relax its policy on foreign ownership of property,
3. its mortgage options made available to foreigners and
4. its recent membership in the European Union.
There is lots of possible investment property in Turkey but vacation properties are deemed to be the most lucrative in the present and are predicted to continue in the years to come, especially the resort industry.
Proof of that is from 14 million tourists in 2004 that herded in the coasts of Turkey, it has increased today to a whooping 25 million tourists and is believed to increase annually. Most of the people who retreat to Turkish shores are local tourists and foreign retirees.
Turkey is indeed an appealing vacation getaway because other than its numerous historical sites for being a melting pot of Asian and European culture, it has much natural beauty to offer. It has a warm sunny climate most of the year and it offers beautiful open beaches and sceneries which are truly picture perfect. Added to that is Turkey’s low cost of living in comparison with its neighboring countries.
Another encouragement promotion of foreign ownership of Turkish land includes certain tax incentives to foreigners. Within 5 years from the date of purchase, no capital gains are assessed. No capital gains are also imposed for properties owned for 1 year or so.
In fact, it has been predicted in 2006 by Amberlamb, an expert in property investment that the industry of sale of Turkish property is bound to become of the top 5 markets in Europe with respect to appreciation of capital.
There is no better time to purchase investment property in Turkey – especially holiday properties – than now since its popularity to foreign investors and vacation house owners has only began.

Mortgage for Foreigners in Turkey

2008-04-07T00:49:00.002+02:00

Do you know that today; mortgages for foreigners in Turkey are liberal and very encouraging to investors?
Turkey is gearing towards liberalization of its national policies. Among the major advances in Turkey is the loosening of the country’s policies on ownership of foreigners of real property. As a result of such amendment, more and more foreigners coming from nearby European countries and the rest of the world invest in Turkish property.
There is a variety of means to own property in Turkey: use of private funds, a simple personal loan and loan with mortgage of property. Of these three, mortgage is the most efficient and convenient means.
Because of the demand for Turkish property mortgage, the country has tailored its mortgage laws to cater the growing industry of real estate sale to foreigners in order to encourage it. Today, the presence of a strong set of laws on mortgage makes Turkey a predictably good property investment on the map.
Most banks have a package or plan of mortgage for foreigners in Turkey, who are interested in buying property. In fact, even nationals from Great Britain and the other Scandinavian countries have chosen this scheme in order to facilitate easier ownership over the property since it is more expedient.
Just as well, applying for a contract of mortgage in Turkey is made more practical for foreigners seeking to own property. There are only four major requirements – a valid passport, proof of income, tax returns in the preceding year, and credit and mortgage statuses in the country of origin. After the mortgage is approved, the loan is released to be paid to the sellers of the property and title over the mortgaged property is issued in the name of the mortgagor.
In addition, it is notable that Turkey, in encouraging foreign ownership of property, has not set a maximum amount for mortgage to foreigners but has only set a considerable minimum of 30,000 Euros as floor mortgage price. In addition, foreign mortgagees are allowed to apply up to 65% of the value of the property as loan to finance the purchase.
The made-easy mortgage for foreigners in Turkey and the non-rigorous procedure in its application marks a market tendency that will bolster the increase of demand for real estate in Turkey.

The Future of Turkey Property

2008-04-07T00:48:00.000+02:00

Turkey property is said to have one of the most promising future in the years to come. Its recent membership in the EU and a well-maintained economy are keys to the rise of demand for real property in the country. As of the present, property market in Turkey is only beginning to rise.
There is so much on Turkey property than is known as of the present. Being the 37th largest country in the world, it offers a lengthy land mass to exploit. Of the possible investment property in Turkey, however, vacation properties are predicted to be the most valuable in two to three years. As proof to that, only last year, 25 million tourists have crowded the open pristine beaches of the country, searching for the sun and sea.
The country is expected to be one of the top holiday vacation spots in the map that the value of the assessed Turkey property is expected to increase more than 100% its value as of the present. So, in the next ten years or so, Turkish property is predicted to be one of the most profitable investments in EU real estate.

The beaches of Turkey are stunning and are believed to be one of the most beautiful in Europe. The country has a wide seashore line since three seas encircle it. To the west, located is the Aegean Sea; to the south, the Mediterranean Sea; and to the north, the Black Sea. Much of these properties are still undeveloped and undiscovered yet. It then makes Turkey, a huge market for vacation resorts to cater to the increasing number of tourists that flock the country.
What makes the country more luring to foreigners is the fact that it has hot, dry summers of a Mediterranean temperate climate. In fact, compared to other EU destinations, it offers more hours of sunshine in a year. It is more attractive to retirees since the cost of living in Turkey is comparatively low if compared to its neighbors.
There is a bright future ahead for Turkey property especially its Riviera since more and more Europeans become enthusiastic to visit the country in line with its political and economic acceleration. As of the present, real estate property and imposable taxes in Turkey is still comparatively lower than those sold in any of its neighboring European countries.

Mortgages for buying property in Turkey

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There are over 275,000 people from the UK already overseas property owners and this figure is set to climb a lot higher in the coming years according to the Office of National Statistics. Therefore, it is imperative to make the right choice when considering how to finance your overseas property purchase. In addition to absorbing the information set out in our Buyers Guide it is most important to study the mortgage facilities available to you as an overseas buyer.

Mortgages for Turkish Property

If you require finance to purchase your Turkey property, then our partners who are Licensed Credit Broker with over 20 years experience in the overseas property finance market could assist.

Using the Turkish property as security a Repayment mortgage could be raised, depending on individual requirements based on the valuation or purchase price, whichever is the lower, of the Turkish residential property.

CURRENTLY WE CAN ONLY LEND 80% IN THE FOLLOWING AREA'S:

TURKISH RIVIERA & ISTANBUL Turkish Riviera (includes):
Alanya -
Antalya -
Bodrum -
Datca -
Didim -
Fethiye -
Kalkan -
Kusadasi -
Mahmutlar -
Mugla
** All other areas can be considered up to a maximum loan to value of 60% - 70% on a case by case basis ** 75% LTV on residential property - in the Turkish Riviera (see above) or Istanbul only.

Minimum loan: €40,000 - making minimum Purchase Price of €50,000.
Maximum loan: €200,000 - making maximum Purchase Price of €250,000.
Fixed Interest Rates: only over: 1, 3 & 5 YEARS. Euros Only .
Euros: 1 year - 6.10% - 3 years & 5 years fixed available. Fixed Interest Rates only - no variable rates available.

If the property is to be rented out Interest rate increases by 0.60% for the duration of the loan.
Repayment terms ONLY (no Interest only available) of 5 to 20 years
Minimum age: 24 upon application to Maximum age 75 upon completion.

1st Time Buyers? YES.
Staged payment funding available? No, mortgage funds will not be released until the construction of the Turkish property is fully completed and legal registration of the Turkish property has taken place.
Re-Mortgages? No, we cannot assist if the Turkish residential property already has a mortgage on it. Equity Release Mortgage (from existing Turkish Residential property)? Yes, but ONLY if the property is 'mortgage-free'.
Affordability: 45% of NET monthly income - less existing monthly commitments (if clients also have existing 'buy to let' properties, then the rental income received from these, must cover a minimum of 120% of the monthly mortgage amount due). Incomes NOT considered: Incapacity or Disability benefits, Maintenance/Alimony or existing Rental Income. Incomes considered: All employed salary & self-employed incomes only.
Eligibility: Only EU passport holders & UK or IRISH residents ONLY & applicants with 'clean credit history' - no existing Defaults or CCJ's.
Maximum number of applicants: 2

Written Quotations Available On Request

Repayment mortgage of approx € 80,000 over a period of 20 years at an initial Fixed interest rate of approx 6.10% Fixed for 1 year = approx € 584.00 capital & interest per month = a total approximate amount payable over a term of € 143,040 including capital, interest, arrangement and survey fees.

The income criteria is variable
Bank Reference and Employers or Accountants reference if self-employed
Existing borrowing in the UK and Overseas will be taken into account

ALL ENQUIRIES WILL BE DEALT WITH ON A CASE BY CASE BASIS & ARE SUBJECT TO SATISFACTORY CREDIT STATUS & VALUATION

Please note, that as the loan is secured on the overseas property, it is not covered by the UK Consumer Credit Act or the Financial Services Authority.

Overseas Mortgage Providers

We feature a select few when it comes to reccommending mortgage facilitaors from the UK. This can be an easier way to arrange your finance or mortgage requirements before you begin your search. Listed below are some of the advantages to using some of the companies we reccommend.

More than 200 residential overseas/foreign mortgage products available in over 30 countries worldwide including Bulgaria and Turkey
Over 10 years of trading and 20+ staff experienced in conducting business with overseas and foreign lenders
Fully independent with more overseas/foreign lenders and more choice
Competitive and exclusive overseas/foreign mortgage terms
In some countries, no final arrangement fee charged by us for organising the overseas/foreign mortgage
At no cost, can internally pre-qualify your application financially, thereby saving any wasted inspection flights
Can save you time and costs (ie: phone, fax and postage) in both exploring and finding a possible lender
In-house processing and dedicated underwriting team for each country ? who are fully aware of what documentation the lender requires, their lending criteria and how to present the application, which ensures a faster mortgage offer
The use of our extensive database of other relevant professionals such as lawyers, surveyors, currency exchange and offshore company formation experts .

Finance For Property In Turkey

2008-03-02T16:00:00.002+02:00

It is now possible for foreigners to get a mortgage in Turkey.
We are in the Kusadasi area are now able to help you arrange a mortgage with local banks.

Our agent in Kusadasi is in the process of setting up arrangements with local bank/s.
Please remember that if you intend buying in Turkey using a Turkish mortgage that documentation will be required whilst you are in Turkey.
Please ask us when planning your viewing trip what documentation you will need to bring. Kusadasi Property Sales

Typical Mortgage Terms for a Turkey Mortgage (these vary from area to area and each bank has their own rates and lending criteria.)

Loan to value Maximum 65% of the appraisal value (not always equal to the sales price)
Debt to income Maximum net salary to spend to installment for total loan position 50%
Valuation of income Only salary income transferred to a bank account, average profit of the last 2 years, pension income
Maximum amount No maximum
Minimum amount € 30.000 euro
Nationalities All countries that have a reciprocal agreement with Turkey.(Based on these agreements foreigners of the following countries are eligible. UK, Germany, Australia, Austria, Belgium, France, Holland, Ireland, Spain, Italy, Canada, Luxemburg, Norway, Greece as well as some African and South American states.)
Maturity 5,10,15 and 20 years

Loan in YTL Yes
Loan in euro Yes
Loan in Dollars Yes
Loan in British pound Yes
Interest types Fixed
Early repayment Possible ( penalty fee may apply)
Property valuation Done by Bank or appointed appraisal by Bank, pre-valuation paid by Bank
Age of application 25 -70 years
Maximum age at end of maturity 70 years
DASK: nature disaster insurance, House insurance; To arrange via Bank,
Life insurance No obligation
Off plan mortgage Yes, with full bank guarantee from constructor for the total loan amount
Monthly installment payments Automatic payment from a Bank account

Further information on purchasing a Turkish property

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Please note, that non-status/self-certification mortgage facilities are not available through the lenders. All applications need to be supported by a minimum requirement of proof of income. If employed, copies of your last three month's pay slips & your latest P60 and an Employer’s Reference together with copies of your last three month’s Personal Bank Statements will be required or alternatively if you are self-employed or Director of a Limited Company with a shareholding of 20% or more copies of your last three years Audited Accounts plus copies of Personal Tax Returns for the last 2 year & copies of your last 3 Personal Bank Statements will be required on application.

Please note that it will also be necessary to obtain a copy of your credit file via Equifax or Experian.

The lender will NOT take into consideration any proposed Rental Income from the property for mortgage purposes/repayments.

EURO TURKISH MORTGAGE SCHEME ONLY: Your loan is based on your joint net “take home” pay and is calculated on an affordability basis. All your existing liabilities including any mortgage/rent payments, personal and bank loans and any maintenance (i.e.: Divorce) payments together with your proposed Turkish mortgage payments must not exceed 60% of your net monthly income.
Example: Net joint monthly income £2,500 times 60% of that figure is £1,500 minus existing monthly mortgage payment £700 – No other liabilities. This leaves a balance of £800 for a proposed Turkish Mortgage payment.

STERLING TURKISH MORTGAGE SCHEME ONLY: Your loan is based on your joint net “take home” pay and is calculated on an affordability basis. All your existing liabilities including any mortgage/rent payments, personal and bank loans and any maintenance (i.e.: Divorce) payments together with your proposed Turkish mortgage payments must not exceed 33% of your net monthly income after liabilities have been deducted.
Example: Net joint monthly income £2,500 minus existing monthly mortgage payment £700 and no other liabilities = £1,800 x 33% = £594 available for a proposed Turkish Mortgage payment.

STERLING, EURO & US DOLLAR TURKISH MORTGAGE SCHEME ONLY: Your loan is based on your joint net “take home” pay and is calculated on an affordability basis. All your existing liabilities including any mortgage/rent payments, personal and bank loans and any maintenance (i.e.: Divorce) payments together with your proposed Turkish mortgage payments must not exceed 40% of your net monthly income.
Example: Net joint monthly income £2,500 times 60% of that figure is £1,000 minus existing monthly mortgage payment £400 – No other liabilities. This leaves a balance of £600 for a proposed Turkish Mortgage payment.
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PLEASE MAKE SURE THAT THERE IS EITHER A SEMI OR FULL RELATIONSHIP BETWEEN YOUR CITIZENSHIP COUNTRY AND TURKEY. IF THERE IS NOT A RECIPROCAL ARRANGEMENT, IT IS NOT POSSIBLE TO PURCHASE PROPERTY IN TURKEY.

PLEASE NOTE, THAT YOU WILL NEED TO OBTAIN A TAX ID NUMBER (VERGI KIMLIK NUMARASI) WHICH IS REQUIRED FOR OPENING A BANK ACCOUNT, CONTRACTING GOODS AND SERVICES (TELEPHONE, ELECTRICITY ETC) AND DEALING WITH LOCAL TAX AUTHORITIES. YOUR LAWYER WILL ADVISE YOU ON OBTAINING ONE.

IT IS STRONGLY RECOMMENDED THAT YOU TAKE THE APPROPRIATE INDEPENDENT LEGAL ADVICE WHEN PURCHASING A PROPERTY IN TURKEY BEFORE SIGNING THE SALES CONTRACT OR PAYING A DEPOSIT.

PLEASE ENSURE THAT YOU WILL HAVE FULL TITLE TO THE TURKISH PROPERTY ON COMPLETION AND THAT THE APPROPRIATE DOCUMENTS ARE AVAILABLE FOR THE LENDER.

TURKISH PROPERTIES CAN BE PURCHASED EITHER INDIVIDUALLY OR IN JOINT NAMES – MAX 2 APPLICANTS.

ALL PROPERTIES IN TURKEY (IN MEANS OF RESIDENTIAL BUILDING) MUST HOLD A “USE PERMISSION CERTIFICATE” IN ORDER TO HAVE WATER, ELECTRICITY AND SEWAGE.

PLEASE MAKE SURE THAT THE SIZE AND THE LOCATION OF THE PROPERTY IN TURKEY IS IN COMPLIANCE WITH TURKISH LAW. THE PROPERTIES LOCATED IN FORBIDDEN MILITARY ZONES CANNOT BE REGISTERED INTO A FOREIGNER’S NAME. PURCHASE OF TURKISH PROPERTIES LARGER THAN 30 ACRES BY A FOREIGNER ARE SUBJECT TO THE APPROVAL OF THE COUNCIL OF MINISTERS.

THE LENDER SHALL OBTAIN THE SECURITY FOR THE TURKISH MORTGAGE BEFORE LAND REGISTRY OFFICER AND ALL PARTIES TO THE SALES TRANSACTION, INCLUDING THE VENDOR, PURCHASER (AND/ OR THE ACTUAL OWNER IN CASE CITED IN THE ABOVE PARAGRAPH) AND/OR A REPRESENTATIVES OF THE PARTIES NEED TO BE PRESENT. HOWEVER A POWER OF ATTORNEY MAY BE USED TO SIGN ON YOUR BEHALF FOR THE TURKISH MORTGAGE AND LAND DEEDS.

UNLESS YOU UNDERSTAND TURKISH WELL ENOUGH TO COMMUNICATE WITH THE LAND REGISTRY OFFICER OR NOTARY (IN CASE OF EXECUTING SALES CONTRACT), THE OFFICERS OR THE NOTARY IS OBLIGED TO CALL UPON THE SERVICES OF A QUALIFIED TRANSLATOR, BECAUSE THE LAW STATES THAT YOU MUST UNDERSTAND WHAT YOU ARE PURCHASING IN TURKEY. THE COST OF THE TRANSLATION SERVICES WILL BE PAID BY YOU. ALTERNATIVELY, YOU MAY WISH TO GRANT A POWER OF ATTORNEY TO A REPRESENTATIVE OF YOUR CHOOSING, WHO IS FULLY CONVERSANT IN THE TURKISH LANGUAGE.

CHECK WITH THE ESTATE AGENT/LAWYER THAT YOU ARE AWARE OF THE COSTS CHARGED BY THE AUTHORITIES FOR PURCHASING A TURKISH PROPERTY.

MANDATORY EARTHQUAKE INSURANCE (DASK) WILL BE REQUIRED TO COVER THE TURKISH PROPERTY IF THE PROPERTY IS A BUILDING. LIFE INSURANCE IS NOT MANDATORY WITH ALL LENDERS, BUT IS ADVISORY WHERE NOT A CONDITION OF THE TURKISH MORTGAGE.

WHILST ALL REASONABLE STEPS WILL BE TAKEN TO SECURE THE MORTGAGE ON YOUR PROPERTY IN TURKEY AS SOON AS POSSIBLE, DELAYS MAY OCCUR DUE TO THE TURKISH LEGAL AND ADMINISTRATION SYSTEM.

PLEASE NOTE, THAT THE TURKISH LENDERS WILL NOT ADVANCE FUNDS TO PURCHASE OR RENOVATE PROPERTIES IN TURKEY THAT ARE CURRENTLY UNINHABITABLE.

IT IS ADVISABLE TO ARRANGE YOUR TURKISH MORTGAGE BEFORE AGREEING TO PURCHASE A PROPERTY IN TURKEY.

About Mortgages in Turkey

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Turkish Mortgages Rates for purchasing a property in Turkey (including Turkish residential property) are from approx 5.90% in Euros. Please note, that if the property is being built, funds are not available until completion and the property has been legally registered in your name.
If you are considering purchasing a property in Turkey, Turkish Mortgages are available for the majority of Nationals for either House Purchase or re-financing for Home Improvements. Mortgages for other purposes may also be considered.
We are able to obtain pre-approval of mortgages for customers, so whether you are at the very early stages of thinking about purchasing a property in Turkey, already found your new property, or currently have a mortgage on your Turkish home and wish to save money, we maybe able to help.

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Can I Get a Mortgage in Turkey?
I am a foreign national – can I get a mortgage in Turkey?
Only if you are UK , Irish, Belgium, or Dutch resident.
How much can I borrow?
Minimum: €40,000; Maximum: €200,000 (larger amounts may be considered on a case-by case basis), but must not exceed 75% of the valuation or purchase price (whichever is the lower) in the Turkish Riviera* & Istanbul only. Mortgages in other parts of Turkey are dealt with on a case-by-case basis.
What type of mortgage is available and what is the term?
Repayment basis only for a maximum of 20 years - up to age 75. Maximun term is 15 years if loan is below €150,000. Minimum age 24 upon application.
What proof of income do I require?
Required in all cases (can be made up of Earned Income, Pension, Investment or Rental Income. Please note however, it is not always the case that the Lender will take all or part of these Incomes into account when determining the maximum loan available). Non-Status loans are currently not available.
What is the current rate of interest?
From approx 5.90% fixed for 1 year in Euros or approx 6.90% Fixed for 1 year in Sterling. Fixed Rate loans over 3 and 5 years, also available.
Please note, that if the property is Rented, the Interest Rate is increased by 0.60% for all schemes throughout the mortgage term
Do I need Insurance on the property?
Yes, it will be a condition that your building insurance is taken with the mortgage lender
Can I borrow in Euros?
Yes you can borrow funds in Euros.
* Turkish Riviera includes: Alanya, Antalya, Bodrum, Datca, Didim, Fethiye, Kusadasi, Mugia & Mahmutiar.

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How to Apply
In order to obtain a decision in principle, please complete the online application form
Once approval has been given, we will then arrange for the lenders completed application to be send to you for signing and returning with the necessary documents:
Certified copies of passportsProof of incomeLast 6 months personal bank statementsCurrent loan or outstanding credit statementsLatest Mortgage statement (home loan)Business accounts and last 6 months business bank statements, if self employedTHIS IS THE MIMIMUM REQUIREMENTS AND THE LENDER MAY ASK FOR FURTHER DOCUMENTATION TO BE PRODUCED BEFORE ACCEPTING A MORTGAGE LOAN FOR OFFER.

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Mortgage Process
The mortgage process in Turkey, is very similar to the majority of many other countries but can be at times slow, due to the Turkish legal and administration system.
You should be aware that property purchased in Turkey, especially raising of Turkish finance, can be more complicated and time consuming, therefore we would recommend that you start the mortgage process as early as possible to avoid such delays and make the buying process as smooth as possible.
Obtaining an acceptance for a mortgage, will give you the head start you need to purchase a property, this service can be arranged whether you have yet to visit Turkey. Once an acceptance has been completed, you will know the range of property values you will be able to purchase at and place an offer, confidently knowing that you can raise the necessary finance to support this.
Once an offer has been accepted on a property and the sale agreed, the initial sale of contract is draw up, a contract is normally drawn up, which would include the price, completion date and any other relevant information for the sale. An application of transfer is then made to the land registry, with deposits being paid, legal documents being drawn up, local tax numbers being registered. The property is also valued and the mortgage application reaches final sign off with the appropriate lender, with the mortgage offer being released and the property completion date being set, subject to the title deed transfer timescale, as the title deeds need to be in the same names as the mortgage application.
If you are purchasing a property “Off Plan Property” a mortgage can only be raised by completion of the property, however you are still able to apply for the funds and have the mortgage offer in writing, but the final survey will not take place and funds will not be made available until the property has been completed and fully inspected by the lender concerned.

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Mortgage Types on Offer
RE-PAYMENT MORTGAGES (CAPITAL & INTEREST)MAXIMUM TERM 25 YEARS, WITH AN AGE LIMIT OF 75 YEARS. MAXIMUM TERM IS 15 YEARS IF LOAN IS BELOW €150,000LOANS AVAILABLE IN EUROS ONLY

Housing ambition

2007-04-26T13:00:00.001+02:00

GYODER, the Association of Real Estate Investment Companies, expects a new mortgage finance scheme to energise much more than just the country’s housing market, writes Metin Demirsar. Gyoder, the Istanbul-based Association of Real Estate Investment Companies, is gearing up for a national housing finance system that is expected to galvanise Turkey’s construction industry and property market, allow middle and low-income families to become home owners, fuel economic growth across the country and draw in foreign investment. Turkey’s Grand National Assembly is slated to pass legislation on a legalised mortgage system at the start of 2006. “The mortgage system will be a sustainable financial model for the housing industry, banks and the public,” says Haluk Sur, chairman of GYODER and president of Ihlas Real Estate Investment Trust, one of Turkey’s leading property developers. He says that 60% of the country’s 75 million inhabitants will benefit.

Savings hit High inflation, combined with steep interest rates, has constrained the housing market and eroded the personal savings of millions of Turks for a generation. From 1978 to 2001, annual inflation based on consumer prices averaged anywhere between 47% and 125%. “In the 1960s and 1970s, a civil servant could buy a house with his retirement compensation and pension. In the 1980s, he could buy only a car. In the 1990s, his retirement compensation was enough only to purchase a few household appliances,” says Mr Sur, a civil and environmental engineer. Not only that but nearly 55% of all homes in Turkey are slum dwellings, not recorded by authorities and thus untaxed. Vast neighbourhoods of slum houses, known as ‘gece kondu’ (‘night landings’ – literally built overnight on private property or state lands by an influx of Anatolian peasantry), encircle the cities, mar the urban landscape and make up to 70% of the dwellings in the metropolitan areas of western Turkey. These shoddily built housing units are unsafe in earthquake-prone Turkey, Mr Sur says. Now, falling inflation, lower interest rates and a booming economy are at last helping to revive the housing market. In 2004, the economy grew by 9.9%, the highest among members of the Organisation for Economic Co-operation and Development, in the third successive year of robust growth, the State Institute of Statistics reports. Bankers predict that the economy would continue to improve in 2005, supported by an influx of foreign investment and the start of Turkey’s EU entry talks on October 3. At the end of September, year-to-year inflation, based on consumer prices, had fallen to 8%, the lowest level in more than 35 years. In November interest rates on 25-year housing loans dipped to a monthly 1.17% from 2.5% last year, and were expected to drop below 1% by the end of 2006. In the first nine months of 2005, housing loans stood at $6.607bn – about 7% of total bank loans, according to the Central Bank of Turkey. That was a huge increase on last year, when 100,445 individuals took out housing loans totalling $2.544bn (3.42% of all bank loans).

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Housing ambition 2

2007-04-25T00:33:00.001+02:00

Rapid growth

According to GYODER estimates, a record 600,000 homes will be sold in Turkey in 2005, up 22.4% from 2004’s figure of 490,000. “The mortgage business is set to grow rapidly, given the recovery in the economy and declining interest rates,” Bülent Sengönül, an equity analyst with Is Investment, one of Turkey’s biggest brokerage houses, wrote in a report on real estate investment companies.
According to Mert Ülker, a certified financial analyst at brokerage house TEB Investment: “Availability of longer-term consumer financing at historically attractive rates has unleashed the pent-up demand in the (housing) industry.”
Most Turkish banks now see long-term housing finance as one of the few areas where they will be able to make profits. Currently, banks give out housing loans as consumer credits, financing loans from their own assets or by borrowing from local and international money markets. But experts say this poses enormous risks.
“The banking system can’t support the housing industry under the present circumstances,” said Tevik Türel, senior vice-president and director of the Eurasia and Middle East region for Stewart International (a Houston, Texas-based real estate information company), at a foreign investors’ conference in Istanbul in mid-November. “Banks are borrowing funds on the short term and lending them out over the long term. This is producing huge maturity mismatches. The banking system will face serious difficulties in 2006 if a viable mortgage system isn’t introduced soon.”
Under the draft law on mortgage finance, banks and leasing companies will provide long-term mortgage loans and lease-like credits to prospective home buyers, covering up to 70% of the total cost of their homes. The home owner will have to meet at least 30% of the cost in advance. The banks and leasing companies will sell the mortgage contracts to a pool of new mortgage finance companies that are to be established, which will issue bonds, asset-backed securities and mortgage-covered bonds on the domestic and international markets to institutional investors, such as insurance companies and pension funds, to provide long-term funding.
“We are trying to create a system where individuals who want to become home owners will be able to tap the funds of investors who have long-term savings,” says Dogan Cansizlar, president of the Capital Market Board (SPK), an agency that regulates the capital markets.

Secondary market

“A secondary market will emerge and it will become easier to become a home owner in Turkey,” says Mr Sur. He predicts that Turkey’s annual housing loan market could reach $60bn once the mortgage system is in full swing.
Another knock-on effect, he says, will be a reduction in the number of jobless Turks. At 9.1%, Turkey has one of the highest unemployment rates in Europe. Unemployment is particularly high among white-collar workers, many of whom lost their jobs during the 2001 recession. “Long-term financing will allow the construction industry and the real estate market to grow further and help to solve Turkey’s unemployment problem,” says Mr Sur.
Manufacturers of cement, glass, steel, forestry products, home textiles, furniture and building materials, as well as producers and retailers of construction equipment, motor vehicles, household appliances and home electronics, stand to benefit from the coming boom, he says. “The Turkish mortgage market will feed over 240 side industries and will make great contributions to the economy.”

High expectations

Turkey expects to attract considerable foreign investment into the real estate sector once the mortgage law has been passed. Dubai International Properties plans to spend $5bn on property development in Turkey, including construction of Europe’s two tallest buildings in Istanbul, the twin 350-metre Dubai Towers.
A consortium led by Royal Caribbean Cruises has won a tender to operate the Galataport, Istanbul’s passenger liner gateway, for 49 years for $4.3bn. The consortium plans to spend $500m on rehabilitating the port and building new hotels, restaurants, cinemas, convention centres, customs facilities, cultural centres, playgrounds, a shopping centre, a museum and a covered car park.
Foreign concerns Rabobank, Fortisbank, Barclays Capital, GE Consumer Finance, Deutsche Bank and General Motors Acceptance Corp have all announced they will enter the Turkish mortgage market.

LOBBYING FOR CHANGE:
GYODER has led the way in lobbying for a mortgage finance system and assisting the Capital Market Board in preparing the draft law that is now before the Turkish national legislature.Founded by a group of real estate development companies in 1999, GYODER encourages growth of the property market, supports the activities of member companies, introduces and maintains standards in quality and control in building projects and training issues, and acts as a lobby for the industry. Today, with nearly 130 members, it has focused on the institutionalisation of the real estate sector and creation of modern cities through new developments, as well as supporting urban renewal and rehabilitation in the inner cities.Members include developers and owners of shopping malls, hypermarket chains, commercial offices, housing complexes, new residential neighbourhoods, restaurant and fast food chains, hotels and holiday villages, as well as major contractors, property assessors and sellers, and commercial banks. Foreign members include Germany’s Metro and Spain’s Real hypermarket chains, US real estate marketing company Remax, property information services firm Stewart International, and the domestic franchises of fast food chains Pizza Hut and Kentucky Fried Chicken.“Our association aims to rehabilitate the housing market in Turkey and take measures against unregistered and low-quality construction of homes and buildings,” says Haluk Sur, GYODER chairman.Once the new mortgage system is in operation, he says, even low income families may abandon the slums for better housing in new areas of the cities.

The Turkish mortgage market

2007-04-25T00:25:00.001+02:00

The mortgage market in Turkey is small but growing and has had its ups and downs, as Doga Taslardan explains
he Turkish economy has been growing by around 6 per cent a year for the last five years, which is faster than many developed economies and most emerging markets.
Turkey lured in yield-seeking foreign investors thanks to a lucky combination of several factors such as: the global abandonment of liquidity, low returns in safe-heaven countries, overall positive outlook towards emerging markets, EU accession talks kicking off by late 2004, increased transparency and stability of the Turkish financial sector as well as positive relations with the USA regarding geo-politics of the Middle East.
The making of an ‘economic boom’ was rather simple: as confidence lifted towards Turkey global money poured in – in the form of both savings and loans – and as a result of considerable access to longer and less expensive international funding by Turkish banks, borrowing rates fell, which in turn fuelled consumption and thus the economic engine.
Rosy macroeconomics enabled the Turkish finance sector to offer long-term funding at relatively cheap prices for the first time in history. Thus the overall loan portfolio has risen considerably for the last two years, reaching US$110 billion by September 2006.

Total Loan Portfolio & % of GDP
Source: Central Bank of Turkish Republic (Colored bars represents economic downturns.)
Despite the rapid growth, total loan volume is still minimal, with only 29 per cent of GDP compared to European countries where the average is 121 per cent of GDP.

Total Loan Portfolios / GDP
Source: European Central Bank & Central Bank of Turkish Republic
Consumer credit explosion
Economic growth gave birth to better job prospects, improved real wages, higher GDP per capita and consequently more purchasing power, which in turn fuelled the demand for higher living standards. The Turkish lira gained strength and stability against the US dollar and the euro, allowing for low and steady prices on both imported and local goods. Relatively low prices coupled with the availability – for the first time – of long-term funds and low interest rates saw individuals rushing to finance new homes, imported vehicles and other big-ticket items. Such favourable lending conditions allowed more people to buy, bringing about a consumer credit explosion. The rapid growth of consumer loans together with credit cards had reached 40 per cent of the overall loan portfolio as of September 2006.

Total Loan Portfolio Breakdown
As the figures demonstrate, the economic recovery first manifested itself within the consumer loan sector. This increased appetite for borrowing was born out of pent-up demand along with a dramatic shift in public attitudes towards the notion of credit. Turks used to frown upon borrowing and bought goods with whatever was in their pockets or however much they could gather from their networks of family and friends. Within the last few years, however, owning a product or service without making an immediate payment is seen as acceptable, if not desirable. Since banks usually obtain above-market margins for consumer lending they were eager to fund to individuals.
Despite the rapid growth, however, as of September 2006, consumer lending was only 7 per cent of Turkey’s GDP, far behind that of developed economies (around 57 per cent in the Eurozone, 65 per cent in the US and over 70 per cent in the UK). Closing of this gap also presents lucrative opportunities for European banks squeezed by tight margins in their home countries who have rushed into Turkey over the last couple of years. These include Citibank, GE Consumer Finance, HSBC, BNP Paribas, Fortis and Uni Credito, which have been effectively operating in Turkey since 2005.

Consumer Loans / GDP
Source: European Central Bank & Central Bank of Turkish Republic Mortgage lending. The pick-up in consumer lending has been particularly striking in mortgages after the long-awaited fall in interest rates gathered pace in 2005. The breakdown of consumer loans in Chart 3 demonstrates the effects of the 1998 and 2001 financial crises, which helped dry out consumer lending due to unacceptably high interest rates. The graph also reveals how mortgage volumes increased the most within the overall consumer loan portfolio to reach unprecedented levels by September 2006. In 2003, mortgages represented only 14 per cent of the overall loan portfolio, whereas today mortgages have a share of 49 per cent.

Consumer Loan Breakdown (Million $)
Source: Turkish Banking Association & Central Bank of the Turkish Republic
In 2004, the Turkish mortgage market grew by 200 per cent, reaching $1.8 billion from $625 million the year before. In 2005, mortgage lending quadrupled, up by 407 per cent to $9.5 billion, thanks to the most favourable lending conditions in history and the pent-up demand for quality housing.
The two main reasons behind the 2005 ‘gold-rush’ for mortgages were falling rates from 2.5 per cent down to 1.05 per cent monthly (13.35 per cent APR) and extending maturities up to 30 years from only three. This was the first time such striking financing schemes had occurred in living memory due to the lack of an ‘affordable’ housing finance system in Turkey.
As of September 2006, mortgage loans totalled up to $15.1 billion while experts believe if the right circumstances were in place, the $20 billion threshold will be broken by 2007. On a top-down comparison, if Turkey’s outstanding mortgages/GDP reaches 10 per cent, similar to other emerging countries (like Hungary), the mortgage market could easily reach $35–40 billion within the next three to four years.
The main factors preventing faster development of mortgage volumes are relatively high interest rates at around 1.9 per cent monthly (25 per cent APR), a high initial down-payment requirement of around 15 to 20 per cent, other accessibility issues (low, undocumented, seasonal income, etc) and the overall lack of consumer confidence thanks to a rollercoaster economy since the mini-crisis felt in May 2006.
The country missed out on multiple socioeconomic benefits of a comprehensive national housing policy, which would maximise funds for housing or create subsidies. In the absence of favourable lending terms and regulatory frameworks to ensure healthy competition among lenders, only a negligible part of society was able to get a mortgage and so own a house. The share of mortgage lending in GDP in Turkey is still as low as 4 per cent (55 per cent in the USA and 39 per cent in the Eurozone).

Mortgage Loans / GDP
Source: European Central Bank & Central Bank of Turkish Republic Investments.
With a population of over 70 million, Turkey has a lucrative mortgage market potential. Plus, real estate has been the primary investment choice in the country due to decades of high inflation and an unstable economy, along with an unsophisticated investor profile to profit from stock markets, equities, bonds, bills, etc. Houses, on the other hand, prevented people’s savings from being eroded by inflation – houses don’t lose their value in the long run, unless there is a major earthquake.
An ineffective and almost non-existent housing finance system hinders the growth and development of a potentially booming Turkish real estate sector. Restricted to short maturities and relatively high interest rates, over the years Turks had to fund homes through a combination of personal savings (66 per cent), help of family and friends (23 per cent), participation in housing cooperatives (8 per cent) and loans (3 per cent).
Every year, all over the world, approximately US$5 trillion worth of funds are transferred to homebuyers over the capital markets. The lack of a modern housing finance system prevents Turkey from taking advantage of these widely available funds and services. This all changed when the rates gradually came down during 2005. Due to favourable economic conditions, both local and foreign investors were willing to provide funds to Turkish homebuyers with better terms.
The availability of longer-term funds to banks significantly extended maturities, which in turn altered the investment behaviour of households from short-term to mid- and long-term investments. Thanks to the recent boom in consumer loans borrowers were able to make long-term investments, such as buying a house through mortgages, and build up down-payments for housing.

Housing shortage
Now that the appetite is there to use the financial sector’s leverage to own a house, consumers were faced with another well-known reality of Turkey: quality-housing shortages. Turkey has struggled with overpopulation, internal migration, unplanned urbanisation, and unqualified and illegal housing for decades. More than 60 per cent of the housing stock is built illegally without a proper licence, while at least 40 per cent needs renewal, especially in the face of a significant earthquake threat.
It is estimated that Turkey needs approximately 400,000 new residences each year, of which only around 200,000 are being built. However, along with the population growth, downsizing of family units and the increase in urbanisation, the annual housing need is estimated at 600,000 in 2010 and 800,000 in 2015.

Proposed mortgage law
Finally, recognising the severe housing problems caused by the lack of a housing finance system, the government appointed the Capital Markets Board to establish the legal framework for the mortgage business back in mid-2004. The proposed mortgage law drafted by the board has still not been enacted by Parliament, yet is promised to be in effect by Q1 2007. Since the pent-up demand for quality housing is enormous, establishing a healthy mortgage market will improve the standard of living and make Turkey a more attractive EU candidate.
The efficiency of the proposed housing finance system depends on a variety of factors, including macroeconomic stability and implementation of adequate internal infrastructure, such as:
Well-functioning and independent appraisal profession
Effective and quicker foreclosure procedure
Capital market institutions and instruments for securitisation of mortgages
Minimised operational costs in lending and securitisation
Government support through tax incentives, at least during the infancy period.

According to the draft law, only legally built, registered and certified houses will be eligible as collateral when taking out a mortgage. Only Capital Market Board-certified appraisers will be legally permitted to perform the valuations.
From the banks’ point of view, the new legislation will allow for new funding mechanisms, such as asset-backed securitisations and covered bond issues, which are currently uncommon in Turkey. Furthermore, the banks, along with the construction companies, will be jointly responsible and liable in case of non-delivery, late-delivery and/ or defects in constructions for the amount of loan granted within the first year of origination. In addition, foreclosure processes will be improved significantly, allowing for easier and timely default collection and auctioning.
For the consumers, the draft law introduces early payment fees of up to 2 per cent of the outstanding balance, which currently do not exist. The proposed mortgage law allows for floating rates, indexed to a common index and with certain caps, along with hybrid products (fixed and floating rates). Currently only fixed-rate mortgages are available.

Housing accessibility
Prospects of mortgage legislation had raised hopes in many burdened by high rents for decades. This goal to become a homeowner with the new mortgage law – which is taking two and a half years to be enacted – coupled with favourable financing conditions increased the number of households eligible for homeownership, only to see house prices rocket through the roof. The government failed to fight against supply shortages with techniques such as active land supply and land development policy. Thus the ‘accessibility’’ provided by cheap rates has been absorbed by high prices, thanks to unexpectedly high demand.
This all came to a halt last spring. Triggered by the US Federal Reserve’s rising benchmark interest rates in May, investors pulled their money out of emerging markets in a frenzy. Turkey suffered the most from heavy sell-offs, thanks to its monstrous current-account deficit. When investors become sceptical about the sustainability of the country’s economic boom Turks had to watch the Turkish lira sink by around 30 per cent in value over a month.
The overall shakiness of the economy has definitely hurt the mortgage market as well. Mortgage rates rose back up to 1.8 per cent (monthly) from where they stood at 1.05 per cent just a few weeks before. With increasing interest rates, consumers shy away from loans, bringing the housing sales to a near halt. Between June 2005 and June 2006 the mortgage market grew at about 2.46 per cent each week on average. In July, however, the effects of the crisis of May to June started to be felt severely, and the the average weekly growth for July to September fell to 0.2 per cent. There were three main reasons
behind these figures: decreasing consumer confidence, increasing mortgage rates and rising house prices indexed to the US dollar.
In the short run it looks hard to recover from the setbacks suffered by the mortgage market in May. But there is unlikely to be permanent damage with a population of 70 million hungry for quality housing. MFG
Doga Taslardan is a specialist in the Turkish mortgage market
Endnotes:
1 Some investors recorded unprecedented returns around 50-70 per cent on short-term bonds over the last three years while monthly-rolled-over annual savings gained over 20 per cent just last year.
2 Local goods produced with relatively cheap imported raw materials.
3 Before 2005 maturities on mortgages were up to three years. Throughout 2005 they were extended to 30 years.

Source : MFG

At Last a Turkish Mortgage

2007-04-25T00:24:00.001+02:00

Turkeys State Minister and Deputy Prime Minister, Abdullatif Sener, has said a bill regulating the implementation of Turkeys new mortgage system is top priority on the agenda for the 2006 parliamentary year. So within months investors will soon be able to take out a conventional mortgage for up to 30 years to finance their property purchase in Turkey.
Currently, Turkish banks offer only short-term loans, limiting the number of mortgages that can be granted. This has somewhat limited the real estate economy in Turkey today. However the reduction of extremely high levels of inflation through a floating foreign exchange regime and tight monetary policy have led to improvements in Turkeys economic conditions. The countrys high interest rates have, in turn, fallen from around 24% at the end of 2004 to an encouraging 13% at the end of 2005.
Turkey has a huge population of just over 70 million which expands by 2 per cent each year and while 70 per cent of the population is younger than 30 years of age, there is a strong demand for property in Turkey. The new mortgage facilities will boost the Turkish property market to great new levels and we expect to see a dramatic increase in property construction in general, including holiday homes. With over 25 million tourists visiting Turkey each year, the new legislation will undoubtedly encourage further growth in tourism and create some encouraging new buy-to-let opportunities.
Turkey boasts some stunning mountain and coastal scenery as well as a rich and exciting culture, making it a top worldwide tourist destination. Added to this, the current economic climate in Turkey is strong and actively favours foreign investment in the property market, while most experts predict it is now sitting on the brink of a property boom. The introduction of the Turkish mortgage will prove invaluable to finance purchases in numerous new developments currently under construction in prime beach-front locations - it seems there has never been a better time to buy into this growing property investment market.
Finally, with Turkeys EU accession due sooner rather than later, the Turkish mortgage will go a long way to bring Turkey into line with the standards and practices expected from worldwide property purchasers. We believe the results will prove very inspiring to our investors.

Source: Property Showroom

New Turkish Mortgage System

2007-04-25T00:22:00.001+02:00

Turkey’s long awaited mortgage system is firmly on the agenda of the Turkish Government in the run up to the country’s elections, according to reports from the Turkish Daily News this week. Turkey has waited for 15 months for the bill regarding the new mortgage system to be passed in Parliament – this has now been announced to take place before the end of February.The decision to pass the mortgage bill is seen as part of the Turkish Government’s plans to place themselves favourably before the impending elections. This is due to the fact that so many people stand to benefit from accessible mortgages: property purchasers will be able to take advantage of the financing and real estate prices across the board are likely to increase once the bill is passed.Currently, banks offer loans with fixed interest rates, but the new mortgage system will provide purchasers with interest rates that are flexible to adapt to market conditions. As a result, the system is predicted to cause banks to reduce their loan interest rates. Tax advantages under the bill should come into effect within two years.
News of the mortgage bill was received enthusiastically by potential buyers who have been anticipating its passing for some time. It is predicted that these buyers will now take advantage of Turkish mortgages, which will further bolster Turkey’s healthy real estate market.

Source: Obelisk

Turkish property ''to benefit'' from change in law

2007-04-25T00:02:00.001+02:00

The Turkish property market is set to receive a boost in investment following a change in the law governing the industry, it has been claimed.Real estate company Rightmove points out that Turkey has been a favourite among UK holidaymakers for years but has only recently come to the attention of overseas property investors.According to Justin Figgins of Rightmove, this is due to a legislation change that has made investment in Turkish property a more achievable prospect for Britons."Though well known as a fantastic but low cost holiday destination, Turkey is now set to become one of the next big things in overseas property thanks to a change in Turkish law," Mr Figgins said."This change means that foreigners can now obtain Turkish mortgages, which will inevitably lead to an influx of investors to the Turkish coastal resorts where the real bargains are."Prior to the adjustment in the law, the only foreigners able to purchase property in Turkey were cash buyers, but such transactions became increasingly rare as prices increased, prompting the change in regulations.

Source: Adfero Ltd