Turkey Leaseback

  • Thread starter slimJim3600
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slimJim3600

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Hi,

a friend of mine bought 2 apartments at an exhibition in Galway last week end. they are in Turkey and they are pretty good value €56,000 for a 1 bed and €84,000 for a 2 bed.

They are a leaseback with rent guaranteed for 10 years.

she has been telling me I would be mad to miss this once in a lifetime opportunity, but I a bit sceptical, it just seems to be a gift horse.

Q1. Has any one any experience of these type of schemes.

Q2. Do they do exactly what they say in the brochure.

all comments , negative or positive welcome.

Slimjim
 
Seems expensive for Turkey. You can buy properties in the much more stable enviroment of France for within this price range.
 
Well firstly Rainy day while the price may not be attractive compared to other countries such as France, although any of the leasebacks I've looked at in france were over 100k for a two bed, but maybe Ive been looking in the wrong places.

gowvere Show me somewhere in Ireland where u can buy a 2 bed apartment, in a luxury complex 15 mins from airport with rental guarantee for 10 years, maintanance costs covered for ten years, and 10% guaranteed return on your investment.

The point I was making is that it seems not 2 bad on the face of it, and I was wondering has anyone any experience of Turkish investments.

I know it is volatile area, but so is Belfast, and I believe they are trying to enter EU.

Any comments welcome

Thanks

slim
 
As far as I can see the important thing is :

Are you buying an apartment that you can sell on unencombered by penalties that anybody can live in ?
 
Read the small print

What exactly is their definition of Guaranteed ?
Also you muight get 10% for 10 years but what about selling it on after that.
 
Re: Read the small print

where exactly in turkey is it. if its bodrum etc, which part specifically.
 
Re: Read the small print

'I believe they are trying to enter EU.'

I have no personal experience of the Turkish property market but regarding the statement above it is worth bearing in mind that negotiations have yet to start between the European Commission and the Turkish authorities and this process (if successful) is expected to take anything up to 20 years - at that stage Turkey would be admitted to the EU as a full member.
 
I was not aware of a leaseback scheme in Turkey. The leaseback scheme in France is state backed and the applicable law is EU law. The prices you quote do seem dear for Turkey - for example, friend just bought a 2 bed fully furnished apt. in Alanya for €46k. If the leaseback is guaranteed for 1 or 2 yrs then I suspect you are paying for some of it in the price.

I am not convinced of the wisdom of leaseback in France so I would definitely not touch it in Turkey without a lot more information.

Slim 8)
 
afaik there are no mortgages in turkey so any purchase would have to be either cash or via an irish mortgage secured on property here.
 
Both Turkey and the EU are anxious to create whatever cicumstances are necessary to allow Turkey become a member state. I believe it will happen in the next five years.

In relation to the French leasebacks, the Govt backing is misleading. Its guarantee is to repay the VAT in retun for you retaining the property for a certain length. It DOES NOT overwrite the lessee's commitment to pay you rent for the duration of the length and it is for this reason that anyone contemplating such a purchase should satisfy themselves in relation to the boina fides of the management company. Some of these (e.g Pierres Vacances, Odalys) have a better and more established reputation than others.

As has been mentioned, an inflated purchase price can effectively finance the guaranteed rent provision and still clear a profit, so careful consideration should be given to rent/sale capacity of the property at the end of this period.
 
ok folks,

thanks for the advice, very much appreciated. I think I will do some more research before jumping.

although according to a friend who bought 2 of them last weekend in the Great southern Hotel in Galway where there was an exhibition promoting the complex, said they that people were trippin over each other to buy them. apparantley they were advertised in last Fridays indo, stating that the sceme was backed by AMB ambro bank.

im not sure exactly what part of the city they are in but they are supposed to be 15 mins from Airport.

anyway thanks for your suggestions

Cheers

Slim
 
Well firstly Rainy day while the price may not be attractive compared to other countries such as France, although any of the leasebacks I've looked at in france were over 100k for a two bed, but maybe Ive been looking in the wrong places.
Click to expand...
Hi Jim - I think you misunderstand me. I'm not saying that these properties are bad value. I know SFA about property in Turkey. I'm simply asking that you explain the basis for your statement that that are 'pretty good value' to you & the rest of us to evaluate the proposed investment.

And I know you're not going to tell us that it was because they seem cheaper than France. If I told you that [broken link removed] is pretty good value at €200k because it is cheaper than [broken link removed] at €1.1 million, you'd laugh me out of court.
 
Slim,

I've probably been to most of the property exhibitions (particularly for Budapest) held in Dublin over the last year or so and at most of them there was always an air of urgency or even in some cases panic. I tried to ignore the frenzy although I did end up putting down refundable deposits on a few properties myself before I settled for the apartments which I believed offered the best chance of success.

I'd ignore the fact that they were trippin over each other in Great Southern. A considerable amount of them have probably done little if no research at all.

As regards the 'Indo' and other Irish paper property supplements I'd be very skeptical about the content. As mentioned on various threads of this forum, they are not much more than glorified ads for estate agents and developers. There's very little, if any, proper critical analysis.

If these leaseback deals were such a great deal why does a Turkish developer/agent have to travel all the way to a hotel in Galway to flogg them to amateur investors?

I've been to Turkey and Eqypt on business a few times and I wouldn't invest my money (or my bank's money!) there.
 
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