In the last couple years one of the most controversial things that we’ve discussed on this channel has been turkey’s citizenship by investment program now available at a lower price than it was initially as well as the real estate investment required to qualify for turkish citizenship
Now today i want to set aside the issue of the citizenship itself whether you would want to be turkish immediately address why i believe that real estate in istanbul in particular is perhaps more worthy of your consideration than you might have imagined Hi i’m andrew henderson and here at nomad capitalist we help seven and eight-figure entrepreneurs and investors legally go where you’re treated best whether it’s offshore tax planning citizenship planning or investment planning around the world you can learn more at nomadcapitalist.com and i just returned from
A trip to istanbul where i met up with several of our contacts in the real estate industry looked at a lot of different properties and found some very interesting opportunities that i think are the kind of thing that people watching should consider again let’s set aside the citizenship by
Investment program for a moment if you’re interested in that we’ve got plenty of videos and articles on nomadcapitalist.com about turkey’s citizenship program where you invest roughly 250 000 into property or put five hundred thousand dollars in the bank to become a citizen i think it’s a worthy option to consider
For anyone looking at a citizenship by investment program i also know a lot of people have told me that they just feel kind of uncomfortable with the ib idea of being a turkish citizen so let’s just talk about investment for investment’s sake for a moment and certainly the turkish lira has performed
Very poorly in recent years you know what’s interesting to me is that you don’t want to catch a falling knife but i also realize that you know if you listen to people like doug casey for example who went into hong kong at a moment of great chaos
You can be very profitable will the lira continue to drop perhaps i know people who believe that it will start to slowly rebound i know others who believe that it will continue to go down what most people are looking at in 2021 is a drop of the u.s dollar and so i
Think that that might be an opportunity if you’re holding dollars to potentially get into a market where whether you want citizenship or not there could be some opportunities for profit because i believe that you know due to some of the geopolitical issues which are probably overemphasized in the west i’m not
Saying they don’t exist but certainly people sitting in the west and watching cnn are probably more likely to think negatively about a country than people who are actually going and experiencing it you have some good deals prices have gotten beaten up not only in dollar terms due to a lira decline
But they’ve just gotten beaten up especially with the pandemic but let’s go over some statistics for why i think it’s a long-term bet as well as potentially some short-term plays istanbul makes sense because if you look at turkey turkish mothers give birth to about one-third more children than their german counterparts
They are reproducing there are now a population of over 82 million people in turkey 16 million of those officially probably closer to 20 million people live in istanbul and so anytime i look at some of these mega cities anytime i look at cities like istanbul like cairo
Like moscow like mexico city when i can buy real estate at cheap prices that rivals markets that few people have heard of and that don’t have the demographic benefits uh like tbilisi for example gnome pan cambodia i think those are good markets to invest in i’ve done very well invested and i
Think there’s still some juice left in them but istanbul for example is an entirely different animal where you’ve got this great domestic economy where despite everything else they’ve done a good job building up their domestic manufacturing industry they now have brands and if you live in some of the places that i do
Uh like in georgia like in eastern europe you know you see some of these turkish brands you’re buying a lot of turkish products and the quality of them has actually become pretty good to where when i do a renovation in this part of the world i almost always look at turkish
Products i’ve seen the hassle of buying the name brand italian products and i want to buy the turkish product the quality is generally relatively equivalent i get it a lot faster it’s a lot more efficient and so you’ve seen this manufacturing base build up where what that’s led to is a decrease in
Net migration out of the country in 2018 net migration from turkey was down more than 40 percent before that in 2017 for example the numbers were more reasonable something like seven percent in years before that’s similar so fewer people are leaving turkey historically many turks have gone to germany
Have gone to the uk obviously we have helped some people from turkey who don’t want to pay the you know moderately high taxes on income from running a business in turkey we help them move somewhere else but that’s generally a relatively small slice of net migration most people are
Going to find better jobs and in turkey you’ve seen while the lira has dropped you’ve seen wages increasing you’ve seen more opportunities coming up if you look back over the last 20 years to where while turkey was once very eager to be a part of the eu you know jim rogers has said
At some point they realized what he realized which is the eu needs turkey a lot more than turkey needs the eu and so you’ve seen all of these uh you know additional jobs you’ve seen the growth and you have this country that i think is very geographically well
Located people can talk about syria they can talk about iran but you’ve got a country that’s at the door of the eu certainly has had to the consternation of many in europe some influence over eu policy whether that’s right or wrong is irrelevant as an investor you’re also
Close to a growing region in the middle east and north africa and so i think that there is a strong case to make for this and so let me talk to you about one particular property that we looked at recently we called it because i like
To give things names we called it the big unit this was a property that was right on the main shopping street in istanbul’s nashantishi shopping district this is where a lot of the wealthy people live a lot of the international people live you’ve got a lot of people who are very
You know international minded etc wealthy actors wealthy whatever and so you’re on the main shopping street you are a little bit above it so you don’t have so much noise your seven floors up and we’re looking at a unit that while turkey does quote their prices as
Or they quote properties as gross you get a title in gross square meters so that would include your share of the elevator the stairs the common areas it’s kind of weird but we figured out by measuring it that the property is about 185 square meters and we were very quickly able to
Negotiate their price down from 2.5 million lira to about 2.05 million lira and so with the decline of the of the lira we were looking at you know about 260 some thousand dollars and so what that came out to is less than a thousand five hundred dollars per
Square meter roughly i’m giving you rough numbers here less than fifteen hundred dollars a square meter now we’ve seen markets such as phnom penh where you’ve seen a lot of chinese demand in cambodia going to cambodia buying condos halfway out to the airport for two thousand dollars a square meter now
You know our friend reed investigation is still buying stuff for under a thousand dollars in the city center that’s because he uses cambodian company it’s not cheap to use and so the average person buying one property is not going to be able to buy what he’s buying
And you’re going to have to pay more in a much smaller market with much smaller domestic potential in tbilisi we’ve seen some of the markets you know not so far from istanbul we’ve seen some of the properties uh in you know good but not the best districts
Start to flirt with that 1500 number before uh the pandemic you’ll see a little bit of pullback now but because they’re sold in those both those countries in dollar terms i think less pullback and so when i can pay i think by my calculations with the exact numbers a thousand four hundred
And seventy eight dollars a meter i’m in the main shopping district and arguably the best district where if you look at property prices even as the lira has dropped you’ve seen them have a relative degree of holding their value not perfect but relative degree of holding value because in dollar terms
Because of the demand to live there for the same reasons that property in caracas and tehran is not being sold for twelve dollars you’ve seen these desirable areas hold on to their value you go further afield you go into the areas like essentia which have been widely
Over promoted by cheshire which are kind of far away you know i’ve been looking at this market for real estate for about six years there have been a lot of bad areas promoted and when you see people coming in and buying properties for citizenship they buy the glossy magazine stuff they overpay
You know they’re getting new properties but for these older properties here’s a property that needs some renovation that if you look at comparable properties you could make i think a relatively quick you know five six seven hundred thousand lira profit if you don’t want the citizenship which requires you to hold
The property for three years or you could renovate it and turn around make six seven percent yield with a u.s dollar lease uh someone paying you in dollars because of the quality of the property you would get that kind of tenant so you’re getting dollars secured you have
Moderate taxes on real estate rental income in turkey it’s relatively easy to handle compared to many european countries and you can resell the property to profit in the future um while if you want to hold on for the long term you know benefiting from these demographic trends
You know when i talk to people in the investment business as well as in the citizenship business and we say look forward 20 years is turkey going to be a stronger country or a weaker country i think we all pretty much agree it’s going to be a stronger country
Are there some challenges now of course there are but you know for me a lot of the investments that i make i’m planning on making for decades to come and so if i’m looking at these trends uh it’s a it’s going in the right direction i’m open to hearing comments
And i’m sure many people will disagree with me i’m also not saying to take everything out of stocks and sell all your u.s real estate and put your money in turkey but i’m saying for a fraction of your portfolio and perhaps for a unique second citizenship to add to your citizenship portfolio
There are some numbers that lead me to overcome the challenges which may be temporary in the country itself and so i think that these numbers make me think that the prices have gone low enough you have a market that has a lot of built-in potential more people will be moving to istanbul
And to the cities whereas in western countries you’re seeing a movement away from new york away from san francisco but with jobs being created in a different type of economy especially one that’s growing i see more people moving to these cities in search of higher
Wages it is not as much a work from home economy it may become so in the future years but you will see more people living in istanbul and if you look at you know some of the deals that our people have done over the last year i think they’ve been very successful
With this model those are the reasons why i think it’s at least worth considering you can weigh the pros against the cons i think that too many people in a market like this focus on the cons because they hear muslim you know when i first took mrs h
To malaysia she said muslim country i’m afraid now it’s her favorite country in the world because she realizes how nice the people are in malaysia not the same you know country not a direct comparison but if you’re only you know saying muslim country islam country saw this
Guy i don’t like him on cnn i think it’s worth considering the actual numbers as an investor potentially the citizenship as a kicker as a backup plan something worth considering how can nomad capitalists help you four ways number one subscribe to our channel and click the notification bell
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