Citizenship by investment: how to do it
In September 2018, the Turkish government announced that citizenship would now be on offer to foreigners who buy property worth at least 250,000 USD. The move is a bid to increase the volume of property sales to help bolster the lira.
With citizenship now on the table, property investors have an incentive to add to the existing reasons to invest in Istanbul and wider Turkey, which include excellent returns, a wide range of high calibre property and solid exit strategies - all underpinned by Turkey’s stable and growing economy.
How to get citizenship by investment in Turkey
The process of gaining citizenship by investment in Turkey is a five-step process, which is governed by a new government agency, the Foreign Investor Citizenship Application Special Joint Office, a bit of a mouthful, but more commonly known as FICO. there are FICO offices in Istanbul and Ankara, and more will be rolled out across the country over the coming months.
Here are the steps involved:
Valuation report: your property will be assessed for fair market value. This can be done by an authorised valuation firm (we can help with this). The report can be done before or after purchase.
Certificate of Compliance: the applicant must obtain this certificate from the Foreign Cadastre. The valuation report, Turkish title deed and proof of fund transfer must be taken to the local office, who will scan the documents into the central system. the compliance certificate will be issued if all the criteria are met. The process takes around a week.
Residence Permit application: Once you've received the compliance certificate, you can apply for a residence permit. the FICO office can streamline this process. You'll need the same documents as for a tourist's residence permit, along with the compliance certificate. Applicants who qualify will receive a permit valid for one year.
Filing address registration: Once your residence permit is processed, you'll need to complete address registration at the FICO. You'll need your title deed and you'll receive a written confirmation of your address registration.
Filing a citizenship application: You can now apply for citizenship, with the necessary papers as well as the compliance certificate and the title deed. The application will be sent to the General Directorate of Population and Citizenship Affairs, who will do a background check. Once the application is granted by the Ministry of Interior, it's passed back to the General Directorate, who will issue applicants with Turkish ID cards and invite them to apply for passports.
- The purchase must have taken place after the regulation change: before 18 September 2018. Otherwise, the old regulations apply.
- Owners can't sell their property for three years.
- If you have a mortgage, the mortgage amount will be deducted from the sale price to determine the value.
- The value on the deed can't be lower than the amount on the valuation report.
- The applicant must show bank receipts showing the transfer of the sale price.
- The property must be registered in the name of the applicant (you can include your spouse and minor children)
Streamlining the process of citizenship in Turkey
Property Turkey director Cameron Deggin said the easiest and most assured route to citizenship is a straightforward purchase of freehold property with existing title deeds.
This means property that’s already completed: new build or resale dwellings. Investors can also buy several properties to make up the 250,000 USD.
If the property already has title deeds in place, the bureaucracy is black and white, as the government can easily place a three-year restriction on the title - this is the amount of time buyers are required to hold onto a property after obtaining citizenship.
Take the safe option
Deggin urges investors to take the safe option - which will also prove to be the most lucrative in terms of investment returns, he says.
“This kind of investment in residential property in Istanbul opens up a world of opportunity for investors. The trend in Istanbul right now is branded hotel residences offering the kind of perks and lifestyle that will attract the sort of wealthy, long-term tenants willing to pay upper tier rents. Or of course you can enjoy these trappings yourself if you choose to make Istanbul your home.”
But Deggin says the lifestyle on offer at these branded residences is just “the cherry on top” for his investors. “Because they’re branded, and as a rule in excellent locations, demand is extremely high for these properties, assuring not only high return on investment, but an assured exit strategy when you’re ready to sell.”
The rise of branded residencesMedia Highway, is the brainchild of the eccentric designer Philippe Starck. There are only a few units available left in the project, which aims to offer affordable luxury.
The project offers 7 percent rental income, and capital growth is tipped to reach 10 percent annually - 60 percent growth in five years. The apartments have hotel facilities with built-in property management - hugely appealing to investors looking for a low maintenance yet very lucrative investment.
Deggin’s client invested in five apartments in the complex including four one-bedroom units which he will rent out to tenants. The remaining unit is a larger one for his family, the investment means the Qatari and his family are now eligible for citizenship.
“The G by Yoo properties are freehold and in the finishing touch stage, which means my client is automatically granted citizenship. Ties between Turkey and the Middle East are very strong, and Istanbul property is a desirable addition to Middle Eastern investor portfolios, so we’re going to be seeing a lot more of these types of property investment,” Deggin says.
Bonus tax break for foreign investors
In 2017, the Turkish government introduced a VAT exemption for first-time foreign buyers. The motivation was to increase the volume of property sales to foreigners. The latest data shows the move worked, with a 24 percent increase in the number of property sales to foreign buyers last year.
“The climate right now is perfect for buyers,” Deggin says. “With citizenship and VAT exemption available at the same time, clients feel they’re getting the ultimate deal.”
Five examples of completed homes available in Istanbul and the South Coast of Turkey that we would recommend
With the criteria that developments need to be completed, or almost completed so investors can obtain the all-important title deeds, these are Deggin's picks for investments to help you on the road to Turkish citizenship.
Many investors looking for citizenship do so because they're keen to move their families to Istanbul, says Deggin.
"Asia and Europe at your doorstep, great educational facilities and work opportunities for the kids, and a wealth of things to do."
Residences like this one fit the bill for families, as well as being ideal investments in Turkey - the perfect opportunity.
With an investment of 250,000USD, you'll obtain Turkish citizenship for your family, as well as this luxurious villa in safe, family-friendly Buyukcekmece - an area just a 30-minute commute from central Istanbul.
With lifestyle facilities galore and huge living spaces, this sumptuous villa ticks just about every box for comfortable family living.
While some buyers want a quiet life, others want to be amongst the glitz and glamour of the city.
This Nisantasi apartment is right in the city centre, near some of the most incredible shopping streets in Istanbul.
There are just five luxury residences available in this apartment complex, so if you'd like to buy a couple - live in one, rent out the other - you'll need to act fast by calling or contacting us today.
These properties will be completed in September to exceptional standards, allowing a clear route to Turkish citizenship - as well as the not insignificant 18% VAT saving which is on offer until the end of September.
Become a property mogul in West Marina. This purpose-built community is designed as a stand-along community.
If you buy a handful of these properties - which are excellent quality and built by one of Istanbul's top construction companies - you'll not only be eligible for citizenship, but you'll build a considerable empire of rental properties that have some enviable capital gain accumulation ahead of them.
The sea view properties offer excellent lifestyle facilities worthy of an upmarket hotel complex, assuring investors of ongoing rental income and a safe exit strategy.
For investors, extremely favourable payment plans and added discounts for cash buyers are available today.
In an enviable location close to Yalikavak's Palmarina, in Bodrum, these luxury villas are sleek, stylish and ideal for investment.
Yalikavak property commands high rental income, and Bodrum's reputation as Turkey's St Tropez has sealed its reputation amongst the jet set, assuring the peninsula's continued success.
While these properties are slightly different to Istanbul's in that the villas will be solely let over the summer season, they're no less lucrative, as the area's luxury property can net the owner excellent income over a busy summer period - plus, leave the home free for visiting during the cool winter period.
The ethereal White House is one of our most popular properties.
The custom-built villa is designed to our clients' specifications, allowing individual properties to reflect their owners' personalities.
Fethiye is a bustling city on the Mediterranean, with a thriving community that's not dependent on tourism - the ideal coastal location for families.
From an investment point of view, property in Fethiye does not have the exciting fast-paced growth of Istanbul, but a steady and safe capital accumulation, supplemented by rental income from the many holidaymakers who flock to the coastal city each year.
If you are looking for a five-star property for modern family living in Buyukcekmece, look no further than these spectacular houses for sale within one of the most sought after private estates in Istanbul – designed by a renowned developer.