House Hunter: Turkey

I've fallen in love with Turkish delights
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The Independent Online

The problem

DEBORAH MASARYK, OF BIRMINGHAM, WRITES: In the spring I went to Bodrum, in Turkey, on holiday and fell in love with the country, its climate and people. I spent much of my time in a resort but I also went outside to see the "real" Turkey - now I want to buy a property.

I've allowed three months to elapsed to ensure this wasn't just a holiday flight of fancy, but I've still got the bug and now I want to buy quickly. I cannot speak the language, so any holiday home I buy must be in a resort area, but which are the most popular and what are prices like? Is it easy to get a mortgage and will it be a good long-term investment?

I've got a budget of up to £150,000 at the very most but unless I can get a villa for that much money, I will settle for an apartment. What is available?

The advice

GRAHAM NORWOOD REPLIES: Turkey has developed extensively, and hitherto insignificant fishing towns are now large resorts, thanks to rocketing demand since foreigners were first allowed to buy homes in late 2001. Most sought-after is the "turquoise coast" area in the south-west corner where the Mediterranean and Aegean meet.

"Altinkum, Bodrum, Fethiye and Kushadasi are popular with British and Irish buyers. For £20,000 you can buy a coastal flat in Altinkum where there's been 25 per cent price rises over a year," says Tony Gair, of the Turkish Property Centre, in Newcastle.

Alison Thornton, of sales agent Headlands International, says: "Dalaman has also become a hot spot. There are plans to build marinas, golf courses and other amenities, as well as expand the airport next year."

Average Turkish resort prices rose 20 per cent in 2004. A three-bedroom house will typically cost £60,000 in Altinkum, £100,000 in Bodrum, and £130,000 in Fethiye, according to local agents, so you should have a choice of villas as well as much cheaper apartments.

Turkey's Muslim conventions scarcely surface in resort areas; but in some places it is difficult for Britons to buy a car without being full-time residents, and it is bureaucratic and expensive to ship large items to Turkey, so complete your new home with local furnishings.

If you succeed in buying a place, you may be on to a wise financial investment. First, if budget airlines such as Ryanair and easyJet open routes to Turkey, property prices will boom.

Secondly, if Turkey joins the EU, general prosperity will rise, again triggering capital increases for home owners. The problem is that both of these are uncertain, and if they do not happen, you may have only the sun and a cheap home to console you.

There is one other, temporary, hitch. In July, all laws allowing foreigners to buy homes in Turkey were ruled illegal by the country's constitutional court.

This is regarded as merely a technical problem and the laws are now being modified, but in the interim all purchase applications to the Turkish land registry have been put on ice. "We've not been given a timescale when the matter may be resolved," says a British embassy spokesman in Turkey.

The solution

Property one: Villa near Hisaronu, south west Turkey

Price: £153,000.

Agent's details: This three bedroom and three bathroom villa is part of a small eight-home development but with more homes to be built in later phases. The property has air conditioning, central heating, a private pool and is in a secluded location.

Agent: Headlands, 0845 900 51 51

Property two: Apartment at Dalaman

Price: £39,950

Agent's details: These flats are a five-minute drive from Dalaman beach and are in a complex with communal gardens, car parking and security, tiled floors, marble stairs and a jacuzzi.

Agent: Headlands, 0845 900 51 51

Property three: Duplex at Calis near Fethiye

Price: £55,000

Agent's details: Two bedroom apartment at Calis near Fethiye, located about 15 minutes from the beach and 150 yards from local bus service to Calis town centre. Potential to convert part of apartment into third bedroom with sun terrace.

Agent: Tulip Properties, 0090 252 614 1441.

Fact file

Until recently, foreigners could buy only in cities or resorts, but now they can purchase village homes. Remaining restrictions mean you cannot buy in or near military zones (5 per cent of the land), nor plots of 30 hectares or more, nor homes directly overlooking some islands.

Once you choose a home, appoint a lawyer to draw up a contract, and pay a deposit of 4 to 10 per cent. The lawyer must check legal titles, local searches and that the home is free of debts which would fall to you on completion. If satisfied, you and the seller plus lawyers should be at a Turkish land registry office to sign the deal.

Lawyers' fees can be 4 per cent of purchase value, and the buyer usually pays the estate agent 3 per cent; stamp duty is 0.3 per cent, and annual property is between 0.1 and 3 per cent. When you sell, you pay 25 per cent of your profit back in tax. All Turkish houses are freehold and it is easy for property to be inherited by spouses or children if you set this out in a will.

Avoid allowing the seller to undervalue the property on title deeds to limit their tax liability. "If it's later discovered, it may make it harder for you to sell," says Simon Conn, of Conti Financial Services, a mortgage broker specialising in foreign purchases.