A new wave of wealthy investors from the Middle East and Russia is increasingly eyeing to buy luxury real estate in Istanbul, lured by a relaxation in property laws, relatively cheap prices and a thriving economy.
At the Varyap Meridian complex, 92 percent of 1,200 apartments on sale have been snapped up three months before the development is fully open, 7 percent of them by foreign buyers.
“Istanbul is becoming a second London for the Arab world,” said Erdinç Varlıbaş, chief executive of Varyap, the developer of Varyap Meridian.
A revision to Turkish property laws, announced in May, abolishes a reciprocity rule that only allowed investors from countries where Turkish nationals could buy real estate to buy property in Turkey. The bill also allows the government to double the amount of land foreigners can buy in Turkey to 600,000 square meters, although for now a limit of 300,000 square meters remains.
Turkish property prices marked the third-fastest growth in the world in the year to June, behind Brazil and Austria, surging more than 10 percent and outpacing Russia and Hong Kong, according to the Knight Frank Global House Price Index.
Turkey’s Association of Real Estate Investment Companies (GYODER) forecasts that property sales to foreigners could nearly double to $4 billion in 2013, from $2.5 billion last year as a result of the changes, which will open up the market to buyers from the Gulf, Russia and Central Asia. Annual purchases could reach $10 billion in the medium term, says the group’s chairman, Işık Gökkaya.