Turkish Developer 1 Billion IPO Shows Strength of Turkish Market

Turkish developer Emlak Konut is currently in the process of selling off a 25% stake in the company, in the form of 625 million shares priced between 1.60 and 2.15 liras – up to 70% is expected to be sold to foreigners. The sale is expected to raise over 1.3 billion Turkish liras.

This is the 6th IPO by Turkish real estate companies this year, and now 19 developers are operating on the Istanbul Stock Exchange. With interests rates so low and the economy one of the fastest growing in Europe, the IPOs are unsurprisingly doing very well indeed. In fact, according to the Turkish Capital Markets board the IPOs not counting that of Emlak Konut are worth over 600million liras combined.

But it is not just the IPOs that are doing well, in fact, the IPOs are the direct result of massive growth in the wider property market. With the aforementioned interest rates at record lows and exceptional growth in the economy, demand for housing in Turkey is growing massively.

Owned by government housing authority Toki, Emlak Konut was in an excellent position to capitalise on that growth. The company buys land from government institutions and then hires contractors to construct housing compounds.  The revenue that is brought in is divided between the parties.

So far this year the firm has constructed 350,000 homes and has contracts out for a further 100,000. The money raised in the IPO is to be used for projects and is part of a 6 billion fundraising effort.

Now is the Time to Invest in Overseas Property

If you’re interested in purchasing real estate around the world, now is the time to do it.  House prices have been sinking for quite awhile, and though that is not good for sellers, it is good news for buyers interested in committing to a sound investment over the next ten or more years.

According to Global Property Guide (globalpropertyguide.com), there has been a 15 to 18 % drop in house prices in the UK, which raises the eyebrows of potential foreign and at home investors.

Nick Barnes, who is the head of international research at Knight Frank, states that now is the time for those interested in buying their dream home in their dream location.  In some highly sought after locations, house prices have decreased up to 40%. 

The consensus is that despite falling prices now, investors are optimistic that the property market value of homes will make a steady increase over the next ten to fifteen years. 

Some of the hot spots for potential purchases are France, Spain, and Italy.
In France, the hot spots are Normandy, Brittany, the Dordogne, and the Cote d’Azur.  A 7.5% drop in house prices last year makes France a great choice for many British buyers overseas.

According to Mark Stucklin, head of Spanishpropertyinsight.com, house prices in Spain have dropped at least 20%, making it a prime time to look for investment opportunities.  Many newly built properties, even on the beach, sit empty just waiting for occupants.  Some prices have been slashed up to 40% in attempts to sell.

Italy is seeing price cuts as well.  Tuscany is a favored vacation and living area and prices have not dropped dramatically, but they have decreased enough to take notice.  Northern Tuscany, the Lakes region, and Venice have all seen prices cut up to about 20%.

Turkish Property: a Look Back at the Last Couple of Years

Many people expected a severe downturn in the the Turkish property market in 2009, and who could blame them? Turkish property is fuelled by tourism, and tourism was dropping drastically as we ended 2008 with predictions that 2009 would be a very bad year indeed for global tourism. The fear was realised, but fears over the Turkish property market in 2009 were most certainly not.

This is mainly because the UK fell into the crisis faster and harder than the EU, and as a result the Euro skyrocketed against the British pound. This led to more and more Brits (and those with another currency the Euro was soaring against) looking outside the eurozone for cheaper and/or better value for money holidays, with more spending liras for their pounds.

This caused what would have been a big fall in tourism and British visitor numbers to be a slight, tiny drop in British visitors, and in overall visitor numbers as well. In Turkey it is a common saying that the tourists of today are the holiday home buyers of tomorrow, and the benefits of this are being felt this year -- especially because those forced to look outside the eurozone were mostly discovering Turkey for the first time.

We can see the benefits of this in the May report from overseas mortgage provider Conti, which said it gave twice the quotes for Turkish mortgages this May as it did last year.

Since then we have heard reports of similar increases in demand from other sources, most of which state that it is more investors that are pushing up the overall numbers, when combined with the core holiday home buyers.

"The reasons for this [increase in the number of investors] are the fact that the Turkish economy is growing much faster than that of the EU, which is also embroiled in a sovereign debt crisis; a sovereign debt crisis that has eradicated much of the competition to Turkish property, including Spain, Greece, Italy and Portugal. On top of that Turkey has emerged from the recession as one of the fastest growing, most fiscally stable countries in the world," said Aydin Cakir, director of New Home in Turkey.

Realtor.com Goes International

Realtor.com, the US' largest property portal run by the National Association of Realtors is expanding into the world of international property, with translation services and international listings.

The portal currently features US property only, but it is already visited by 575,000 international users ever month, according to its data. It hopes to expand on this coverage of its clients US properties, and will also carry international listings as well.

"Realtor.com will expand the exposure of U.S. real estate listings to global markets and add international listings," said NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I.

"While all real estate in the U.S. is local, the same is not true for property owners. The U.S. continues to be a top destination for international buyers from all over the world. Foreign buyers understand the value of owning a home in this country and can rely on Realtors(R) to help guide them through the process of buying property in the U.S. With expertise, knowledge and experience, Realtors(R) have a global perspective, reflecting the increasing importance of foreign buyers to U.S. home sellers," Phipps said.

Realtor.com is a collaboration with Move Inc, which brings the internet technology know how to the NAR's industry clout to make a US only portal the most powerful property website in the world. Now that it will cover the world, one would assume it to become the most powerful overseas property portal, but this is far from being a given.

Rightmove is the largest UK property portal, and the presence of its overseas division is huge in the world of overseas property, but not the biggest. Although the fact that it is inextricably linked to the main rightmove site (same domain means no Alexa etc) we can see from the search results that there are more prominent sites in the overseas arena.

There is a lot to be said for sticking to your niche and ensuring your continued domination therein. Sometimes branching out works out tremendously, other times not so much. Time will tell which of these is true in the case of Realtor.com.

32,000 Brits Own Property in Turkey

32,000 British people own property in Turkey. Fact. Collectively they own 6 million square meters of Turkish land. Fact.

These figures are not an estimate, they are the official figures recently released by the Turkish General Directorate of Land Registry.

The data shows that the British are by far the biggest overseas buyers of Turkish property. According to the figures foreign buyers own 65 million square meters of Turkish land, with 6 million square meters Brits own almost twice the amount of land that Germans -- the second biggest owners -- do at 3.5 million square meters. Surprisingly Greeks are the next biggest owners with 3 million square meters.

Note the lack of Russian buyers in the top 3. A recent chart by the largest Russian language overseas property portal showed that Turkish property is third most popular with Russian buyers, which are currently millions strong.

According to New Home in Turkey the number of Russian buyers as well as those from eastern European and Baltic states are growing, but it will be maybe 5 - 10 years before they overtake Brits and Germans in the Turkish market, if ever.

Director of the firm Aydin Cakir said:

"Since the Turkish property market opened to foreign buyers in 2002, and then further in 2005, British buyers have always dominated the market. While Germans are the largest tourism market, Brits are more prolific buyers of holiday homes, with a much larger proportion of tourists buying property in a given country. Russian numbers are growing, but it will be at least 5-10 years before they overtake British and German buyers, and they may never do so."

New Istanbul Airport to Increase Accessibility of Turkish Property Markets

The Silviri District, a suburban area in western Istanbul is to become home to the city’s third airport, after the airport was green lighted by mayor Kadir Topbas. The airport, which is being built because of massive growth in passenger numbers to the city’s existing airports, is to be the biggest of them all. According to the mayor the new airport will be several times larger than Istanbul Ataturk.

The mayor also revealed plans for further expansions in the city’s airport capacity, via expansions at the existing airports, he said:

"These plans have been made in cooperation with the Transportation Ministry. They want to increase the capacity of the current airports in a short period of time. There is an additional runway at Sabiha Gökçen. We are considering building another runway at Ataturk Airport. But we have added a third airport to our plans."

Istanbul Ataturk, the city’s main airport received some 30 million passengers in 2009. It also saw passenger numbers increase 13% year on year in the first four months of 2010.

Meanwhile, smaller airport Sabiha Gökçen, home to the majority of Istanbul’s budget capacity is also seeing passenger numbers grow rapidly; it is expected to receive in excess of 11 million passengers this year.

The new airport has the potential not only to boost the Istanbul property market, but the Turkey property market as a whole. For many tourists around the world, connecting flights are a necessary evil, and for others a significant saving, the new airport will therefor increase accessibility of property markets across Turkey.

Bodrum to Construct Replica of King Mausolus’ Mausoleum

King Mausolus’ Mausoleum, one of the Seven Wonders of the Ancient World is to be rebuilt in Bodrum.

Bodrum Mayor Mazlum Agan, who is currently running for his third term, has revealed plans to construct a model replica of Mausoleum near the 2,500 year old ancient theatre in Bodrum. What's left of the real Mausoleum is currently on display in the British Museum.

"The place of King Mausolus’ Mausoleum is being visited by thousands of tourists every year. However, they can only see remains of the mausoleum. For that reason, we will build a model mausoleum on a one-to-one scale of the original mausoleum."

The Mausoleum of King Mausolus is an enormous (50m tall) white marble tomb, with iconic columns encapsulated by a stepped pyramid roof, and adorned by a four-horse-drawn carriage on top. The tomb came to be known as the finest tomb in the world.

The tomb was ordered by Mausolus' wife Queen Artemisia when her husband died in 353 BC. Statues of Artemisia and Mausolus lie inside the carriage.

The original site of the tomb now has gardens, with an active archaeological dig to the right, and a covered arcade to the left. The arcade contains a copy of the famous frieze mainly recovered from the castle walls. The original was sent to the British Museum in London in 1846. Four original fragments were discovered more recently.

The replica of the Mausoleum can't really be anything but spectacular, and it will no doubt be massively popular with the thousands of tourists who visit the site of the Mausoleum each year. This could also draw attention to Bodrum's rich history and make it more popular with tourists, and Bodrum property more popular with holiday home buyers.