Political risks and unpredictability undermine Istanbul’s popularity for property investors: Report
ISTANBUL - Reuters
AFP photoWhile Istanbul has been named one of the 20 most popular cities for property investors in Europe, a number of political risks, judicial woes, unpredictability and the accompanying lower quality of life, as well as a lack of a main city plan, have decreased the popularity of the city, experts said during the launch of the results of the Urban Land Institute (ULI) and PricewaterhouseCoopers’ (PwC) “Emerging Trends in Real Estate 2016” report in Istanbul on Feb. 23.
The report ranked Istanbul the 14th most attractive European city for real estate investment among 28 peers, climbing six places from the 2015 report. The report however suggested that the city may not be able to make a leap in the 2017 rankings due to several problems.
Istanbul was ranked the best city to invest in for the 2012 report, fourth in the 2013 report and seventh in 2014, while falling to 20th place in 2015.
Berlin, Hamburg, Dublin, Madrid and Copenhagen were ranked the five best places across Europe.
Istanbul has scale on its side. With a population of some 15 million, it is the largest city in the Emerging Trends survey. It also has a young demographic and a real estate stock in need of upgrading, according to the report.
However, “there are also some political risks so we are a little bit hesitant,” an international investor who was considering going into Turkey said, adding these risks were also deterring others.
“I believe that it will be more of the same in 2016. I still think the global economic backdrop is uncertain. Turkey has political issues and uncertainty. I don’t think any of these issues are going to be solved in the short term,” said a local, as quoted by the report.
ULI Turkey chair Ayşe Hasol Erktin said the lack of a residential plan and several judicial, unpredictability and transparency concerns have undermined Istanbul’s popularity among foreign property investors.
“Istanbul’s regression in the list from the previous years’ rankings has been due to Turkey’s current outlook. Turkey has great potential, but some problems in the quality of life and transparency as well as the lack of planning have ruined the investment climate,” said Erktin.
She noted Istanbul was the sole city on the list in which a main city plan had not been implemented.