September 13, 2007
Property NewsMortgages could see Turkey property prices soar
It is expected that Turkey real estate prices will soon increase after news that mortgages will now be available for the first time.
In the past, property buyers in Turkey could use only cash or bank loans with high interest rates. Recent developments will now allow investors and home buyers to finance their purchase using a fixed interest rate mortgage. Rates can be fixed for either one, two or five years with present interest rates fluctuating between 5.5 to 6.5 per cent. Mortgages in Turkey are based on affordability. A buyer can borrow between the minimum amount of 40,000 to the maximum amount of 200,000 euros. Maximum repayment period for the mortgage is 20 years.
This is good news for those hoping to get a foot in the Turkish property market. “With the introduction of mortgages we can expect to see many first time buyers, both for new and resale property, enter the market,” says Michael Johns of The Right Move Abroad. However, it is also feared that the introduction of mortgages will trigger the prices to go high as an unprecedented number of buyers from abroad and Turkish nationals will now have more chances of buying a home in Turkey. Prices can possibly increase more in already popular second home destinations such as Bodrum, Dalaman, Fethiye and Istanbul.
“This will have the effect of making the resale market one of the most viable around but also new developments are very much in favor, in standing with the country’s young population. Those investing now can expect to see huge capital appreciation over the next few years”, adds Johns.
Property prices in Turkey are already moving on an upward trend. Turkey property experienced a 20 per cent capital appreciation late last year according to the Assetz investment tracker. The company predicted increases of around the same level in the next few years even without factoring in the introduction of mortgages.
Posted on: Turkey
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