The Process of Buying Under-Construction Property in Turkey

What Does it Mean When a Property is Under Construction?

When a property is under construction, it means that the building process is actively ongoing. This can apply to various types of construction projects, including residential or commercial. Generally, properties under construction have not yet reached a stage where they are ready for occupancy.

What is the Difference Between Off-Plan and Under Construction Property?

Off-plan and under-construction properties refer to different stages of a property before it is ready for occupancy:

  • Off-Plan Property: This refers to properties purchased directly from architectural plans before the actual construction has started. Buyers of off-plan properties often rely on project brochures and models to visualize the finished product. This type of property is popular among investors due to lower initial prices and the potential for high returns as the property value increases during construction.
  • Under Construction Property: This term is typically used for properties that are already in the process of being built but are not yet completed. While similar to off-plan in that the property isn't finished, "under construction" implies that physical construction has started.

The Process of Buying Under-Construction Property in Turkey

Factors to Consider Before Buying Under-Construction Property in Turkey

When choosing an under-construction property in Turkey, it's essential to consider several aspects to ensure a sound investment and satisfactory living conditions once the project is completed:

  • Construction Permits and Project Declaration: The developer must have all necessary construction permits. These documents are crucial as they ensure the construction is authorized and adheres to local regulations.
  • Developer's Track Record: Research the developer's history to understand their market presence and reliability. Look into how many projects they have successfully completed and whether they have a history of delays. A developer's track record can provide insights into their capability and reliability in completing construction projects on time.
  • Access to Essential Services: Check the availability of essential services such as schools, hospitals, shopping centers, and entertainment facilities.
  • Transportation Links: Proximity to major transport hubs like metro stations and the availability of adequate ground transport can significantly affect daily commuting.
  • Environmental Quality: The presence of parks, water bodies, and the absence of nearby industrial facilities enhance the living quality.
  • Future Area Development Plans: Investigate any planned developments in the area. Future constructions can impact the neighborhood dynamics.
  • Residential Complex Amenities: Modern residential complexes typically offer a variety of amenities which can include commercial spaces on the lower floors, parking facilities, security measures, playgrounds, sports facilities, and green spaces.
  • Floor and Location: Preferences for particular floors can vary; middle floors are usually the most sought-after. High floors might offer better views and lower noise levels, whereas lower floors might provide easier access and sometimes larger outdoor spaces like gardens or patios.
  • View and Sunlight Exposure: The orientation of the apartment affects both the views and the amount of natural light it receives. If possible, visit the site to get a better idea of these aspects, especially if the building is still under construction.
  • Layout and Usable Space: The layout should be practical and meet your lifestyle needs. It’s beneficial to choose properties with a functional configuration of rooms and minimal wasted space.

Researching and Selecting Reputable Developers in Turkey

Choosing a reliable developer for purchasing a property under construction in Turkey ensures the quality of your investment:

  • Developer’s Reputation: The reputation of a construction company in Turkey is an essential indicator of its reliability, as it must build a solid history of market presence, timely project completion, and the overall quality of those projects. If possible, speak directly to residents of previously completed projects to gather firsthand information regarding the quality of construction and their overall satisfaction with the developer.
  • Legal Documentation: The construction company should be able to provide a registration certificate, a valid construction license, documents proving land ownership or the right to build on it, and detailed architectural and structural plans, as well as approved project plans from relevant authorities.
  • Visit to the Developer’s Office and Construction Site: Visiting the developer’s office can provide additional clues about their operation, as a reputable developer’s office should be well-maintained and adequately staffed. The visit to the construction site can confirm whether the site is active with a full workforce and whether the progress matches the promised timelines.
  • Researching the Completed Projects: Researching the developer's completed projects offers valuable insights into the quality and durability of their constructions. Evaluate the condition of buildings, the quality of finishes, and the maintenance of common facilities. Talking to current residents can reveal much about the developer's after-sales service and any issues with the property.
  • Reviewing the Sales Agreement: Before committing to a purchase, thoroughly review the sale agreement with the assistance of your real estate agent. The contract should clearly outline all terms of the deal, including completion dates, payment terms, fixed costs, the process for transferring the property, and both parties' responsibilities.

By following these steps, you can make a more informed decision when investing in a new construction property in Turkey, significantly reducing the risks associated with such large investments.

Financing Options for Buying Under-Construction Property

Financing Options for Buying Under-Construction Property

There are several financing options available for buying under-construction properties in Turkey, which can be particularly attractive for foreign investors due to favorable conditions:

  • Developer Financing: Many developers in Turkey offer direct financing options to buyers, where you can pay a down payment (usually between 30-40%) and cover the rest through installments. These terms can extend up to five years and are often interest-free, which can be a cost-effective alternative to bank mortgages.
  • Bank Mortgages: The conditions for obtaining a bank loan can vary depending on whether the bank has an agreement with the construction project. If more than 80% of the construction is completed, or if there's an agreement between the construction company and the bank, the bank can provide a loan of up to 70% of the property's value, and the buyer needs to provide at least 20% of the property's sale price as a down payment. The repayment period can extend up to ten years. 
  • Cash Payments with Discounts: Paying the full price in cash can sometimes yield discounts. Although this requires having the total property price upfront, it eliminates the need for financing and interest costs.

Advantages of Buying Under-Construction Property in Turkey

Buying property in Turkey during its construction phase offers several notable advantages that are both practical and financially beneficial:

  • Customization: Buyers have the chance to actively participate in the design process of their future homes, e.g. choosing the layout, finishing materials, flooring type, fixtures, and fittings. This means that by the time the apartment is completed, it’s already tailored to your preferences, saving you from having to make costly changes later.
  • Quality and Safety Standards: Turkish construction firms must adhere to strict European standards. This means using high-quality materials like top-grade ceramics, glass, metal alloys, and wood. Once a building project is completed, it undergoes rigorous inspections to ensure everything is up to standard before anyone moves in. If any issues are found, the developer is responsible for fixing them promptly.
  • Seismic Safety: Given Turkey’s susceptibility to earthquakes, buildings are designed with seismic safety in mind. This includes using pile foundations and reinforced concrete that can withstand significant stresses, ensuring a safer living environment.
  • Flexible Pricing and Favorable Investment Conditions: The cost of Turkish properties under construction is significantly lower than those completed, with the potential for a price increase of 20-30% over the construction period. Most developers also offer the option of purchasing these apartments through an interest-free installment plan.
  • Modern Complexes: New developments in Turkey often come with all the amenities of a luxury complex, including landscaping, security, and full infrastructural facilities, making them comparable to living in a high-end resort.

Guide to Buying Under Construction Property in Turkey

Potential Risks and Challenges of Buying Under-Construction Property

Buying property in Turkey during its construction phase presents certain risks:

  • Construction Delays: Construction delays can occur due to various factors, some of which may be beyond the developer's control. These can include inaccurate estimates of the time required to complete construction or disruptions in the supply of materials. To minimize these risks, it is essential to thoroughly review the purchase contract before signing, ensuring that it includes specific clauses regarding compensation or the return on your investment should the developer fail to meet the deadlines.
  • Developer's Bankruptcy or Halting the Construction: One of the primary risks involves the potential for the developer to go bankrupt, which could lead to prolonged construction or even a complete halt. Turkish authorities maintain strict oversight of the construction process, ensuring that timelines for each phase of a project are strictly followed according to the approved plans.
  • Unmet Expectations: Another risk is the possibility that the completed property may not match the specifications initially promised. This could include changes in the layout, quality, or features of the internal infrastructure, which might result in significantly lower construction and finishing standards than expected. However, these situations are exceedingly rare in Turkey and are more likely to occur with smaller construction firms that have minimal capital.
  • Documentation Issues: Issues with documentation can also pose a problem if a company starts construction before obtaining the official permits. To minimize risks, buyers should verify the necessary documentation by seeking assistance from a real estate agent. The agent can either review the documents themselves or request them directly from the developer.

Contact Us for a Hassle-Free Property Buying Process

Secure your future with a property investment in Turkey with TERRA Real Estate! Our approach ensures a smooth process, selecting only the best properties under construction that promise both high rental returns and potential for appreciation. Our agency values its reputation and guarantees thorough vetting of all construction companies before offering properties under construction. 

Beyond the purchase, we stand by you with a suite of services designed to protect and enhance your investment. Invest with us and enjoy the peace of mind that comes from knowing you have a reliable partner in one of the world's most vibrant real estate markets.

https://terrarealestate.com