Is the real estate business profitable? What about Turkey?
Learn with Imtilak Real Estate, and know in detail and accurately the answer to the question: Is real estate profitable? Learn also about the expected profit rate of real estate in Turkey, and a group of real estate investment advice.
Is the real estate business profitable? What about Turkey?
Table Of Contents
- What is the real estate business?
- What's the location of real estate investment among other types of investment?
- Is the real estate business profitable?
- What's the real estate profit rate?
- Is real estate investment in Turkey profitable?
What is the real estate business?
When answering the question, is the real estate business profitable? It is necessary to clarify both ends of this statement separately.
Business: is the organized process through which goods, benefits, and services are exchanged between more than one party, with the aim of reaping profits, developing wealth, and realizing economic benefits from various commercial operations.
Real estate: is all kinds of properties described as stable and immovable. Such as commercial and residential buildings, shops, lands, apartments, villas, and others.
Accordingly, the real estate business can be defined as the transfer of ownership of a property in order to benefit from it, either by investing it through leasing or waiting for a period of time in order to benefit from the rise in prices over time.
Learn more by reading our article about which is better and more profitable: business or real estate?
What's the location of real estate investment among other types of investment?
Real estate business, given its location among all types and various fields of investment, is described as being among the surest and safest investments in terms of preserving capital and low risk and risk ratios. As the property cannot be seized or stolen, it is not transferable, which makes mortgages the most reliable in most courts as a means of guaranteeing rights. In addition to the uniqueness of real estate with the advantage of not being affected by bank bankruptcy, as is the case with the money deposited in banks, and it is also not affected by the fluctuations that usually affect stock market indicators, which makes it far from the concerns and concerns affecting the rest of the economic investment sectors.
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Is the real estate business profitable?
In addition to being well placed to enjoy a high degree of capital security, the real estate trade has been described as profitable rather than safe, ranking fourth among rich causes, according to data published by Wealth-X, which specializes in wealth measurement. This was the result of a study revealed in 2020 of people who turned their ideas into wealth. According to this study, 4.5% of the wealthy made their fortune through their real estate businesses, and among the wealthy mentioned in the study was Stephen Ross, the richest real estate developer in the United States, with a net worth of $7 billion.
What's the real estate profit rate?
When asking about the rate of real estate profit from doing business in the field of real estate investments, it is necessary to take into account the clear discrepancy, and the great disparity in the rates of profits that are achieved. This is given by looking at the country in which the investment is made, the type of property, and in view of the person who submits the real estate purchase process, his experience, and his ability to make the best use of the purchased property.
On the basis of the above, statistics on the measurement of real estate investment profits have varied in their estimate, although mostly between 10 and 25%, some reports have indicated that real estate investment in some countries can bring profits to 30% of the value of the property annually.
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What are the best types of real estate to invest in?
Real estate trade of different types is one of the best sources of income, but there is certainly a preference by investors for some types of real estate over others, mostly because of the different purpose of investing in the property and the location of the property; However, there are two types of real estate investments that should be mentioned:
- Real estate investment in apartments, whether long-term or short-term. The reason for this investment is that it's a steady increase in population growth, which means a permanent need for apartments, which are mostly meant for housing and accommodation.
- Investment in complexes and commercial buildings: This type of investment is second among the various types of real estate investments, and the importance of the trading centers is due to the fact that it is the framework for different types of exchanges, large transactions, small and medium-sized alike, as well as the urgent and ongoing need of people for trade.
Learn more by reading our article: Is it better to invest in real estate in Turkey within a residential complex or in a normal building?
Is real estate investment in Turkey profitable?
When we wonder, whether real estate investment in Turkey is profitable or not? This means talking about the economy of one of the fastest-growing countries in recent years, as Turkey’s economy recorded a qualitative leap on the ladder of ranking the economies of emerging countries; Turkey rose from 111th in the world to 16th rank achieving a phased goal of its goals, which is to be a member of the club of the twenty most developed economic countries in the world, and paving the way for itself to come and forcefully in the Group of Ten advanced economic countries, according to the strategic plan drawn up by Turkey to reach this goal and set a date for achieving it by the year is 2023.
According to the foregoing, and based on factors that we will mention later, we can suggest that the investment in Turkey will be profitable, and the factors are:
- Government facilities for foreign investors to encourage them to invest in Turkey. The World Bank noted Turkey's distinction in this area since it takes almost two days to open a real estate company in Turkey. The transfer of real estate ownership in Turkey also has the advantage of being smooth and flexible in order to ease the complexities and constraints of foreign investors.
- Not only that, but Turkey has added to these facilities incentives that can be described as tempting to the person who owns a property in it - in terms of his legal description as an investor in the country - to the point of granting him Turkish citizenship in the event that he owns a property worth $ 250,000, and granting him the continuously renewable real estate residency in case the value of the property purchased was less than $ 250,000.
- The vital site occupied by Turkey, as it extends over an area of 783,562 km² between the continents of Asia and Europe, and has a long maritime border with Africa.
Some researchers also describe Turkey as the most important route to the movement of energy sources, across a range of gas transmission lines, such as Tanab Line, StreamLine, Blue Seal Line, and other lines.
This has increased the importance of Turkey's location; the opening of the new Silk Road that connects Europe with China through Turkey, which made it a difficult number on the strategic world map, and made it an international transport node.
Speaking of the importance of Turkey's location; the picturesque views that most of Turkey's cities have, which make the Turkish real estate market go uphill, especially in the field of constructing buildings for recreation and summer holidays of all kinds and features.
The quality of real estate in Turkey: Since Turkey has been subjected to large earthquakes, the most prominent of which was the Marmara earthquake that occurred in 1999, the Turkish government has enacted laws related to building construction to match the degrees of safety and resistance to earthquakes when they occur, which was reflected on the quality of buildings in Turkey.
The percentage of buildings equipped with sound insulation has also increased, and those equipped with insulators have increased, which contributes to reducing the heat in summer and cold in winter. Here, we do not forget the government's relentless pursuit of the continuation of the process of extending pipelines feeding the buildings with natural gas throughout Turkey.
It should be noted when coming to Turkey; the expansion of beautiful green spaces in most regions of Turkey, as the buildings in them, enjoy adequate health conditions, and the reason for this is primarily due to the conditions imposed by Turkish municipalities when granting building permits, from the necessity of spacing between buildings in order to ensure ventilation and to ensure the entry of the sun into most architectural installations.
How much is the expected profit rate of real estate in Turkey?
The profit ratios from real estate trade in Turkey are described as among the highest in European real estate trade, for several reasons:
- Turkish real estate prices have risen steadily annually, owing to the high demand for real estate investment in the Turkish market.
- The low rate of taxes applied to profits generated from real estate trade in Turkey, as this percentage is the lowest in the level of taxes imposed in Europe.
- Turkey is classified as the first country in the world to receive refugees, and it is known that this has a role in increasing the demand for real estate very significantly, especially after Turkey followed a policy that leads to improving the conditions of refugees; By granting a good percentage of the Turkish citizenship, closing the camps, and providing them with facilities to reside in the urban areas they desire.
- Turkish society is among the young communities, as Turkish universities receive more than 8 million students, which means the continuous increase in the demand for real estate ownership, to the point that sales of apartments only - without the rest of properties in Turkey - approached 1,400,000 apartments in 2019, while the value of real estate sold to foreigners has crossed the $7 billion mark.
In view of the previous factors, the profit of real estate in Turkey varies in relation to the region, the quality of the property, and the field of investment, as it is possible that the profit rate in some areas reaches 20% of the total value of the property per year.
Other important information and topics:
- Important advice before buying a property in Istanbul.
- Real estate residence permit in Turkey - buying a property in Turkey and residence permit.
- The most expensive properties in Istanbul; most luxurious, and amazing properties.
Edited by Imtilak Real Estate©
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