The Cheapest Home in Istanbul?

My man in Istanbul, Paul O’Sullivan, is back with another on-the-ground report from this fascinating city.

He’s out from under the snowstorm (you can read all about that here) and adventure awaits.

Though, when he texts saying his life might be in danger, I wonder if he’s leaning into the Indiana Jones part of combing the world for treasure a bit too much.

I’ll let him give you the full story below…

Wishing you good real estate investing,



Ronan McMahon


A Tinder Date in the Cheapest Home in Istanbul
By Paul O’Sullivan

I’m in the back of a beat-up car that’s speeding erratically down a snow-covered highway out of Istanbul, Turkey.

In the front, the driver speaks Turkish to no one in particular, while his passenger, a Russian property investor I met on Tinder, is typing frantically on Google translate. She lies to him that I am her brother, “Pavel.”

I text one of my colleagues to tell him that this might be the last he ever hears from me…

We’re on our way to a suburb in northern Istanbul to check out an apartment for 265,000 Turkish lira. In dollar terms that’s an insanely low $19,704…

I was curious to see what you can buy for that price. And that’s why I agreed to one of the strangest dates I’ve ever been on.

Istanbul is a popular city for foreign investors looking for a second passport, but does it make sense for Western buyers?

Since arriving in Istanbul, I’ve been getting to grips with a very peculiar real estate market. Depending on the source, you’ll get a different story on what’s going on.

I’ve heard both that Istanbul’s real estate is oversupplied and also that supply is getting scarce.

Indeed, looking at the skyline, there could be some truth to both sides. On the one hand, there are a huge number of glassy new skyscrapers, particularly on the Asian side of the city. However, take a closer look and you’ll notice that many of them are incomplete, with work seemingly stalled. Drive by at night and some buildings won’t have any lights on.

Most of these new buildings are aimed at foreign investors, mainly from Iran, Iraq, and Russia. They’re buying for Turkish citizenship, which you can get with an investment of $250,000, as well as to take advantage of a weak lira and to diversify property portfolios. Foreign purchases here was at an all-time high last November when it jumped nearly 50% year-on-year.

When it comes to “value,” however, this is the most dubious end of the market. Granted, investors who bought in Turkey in recent years have done well. According to the Central Bank of the Republic of Turkey (CBRT), real estate prices rose over 32% year-on-year in 2020. However, because of inflation, in real terms it was more like 13%.

Furthermore, last year, before new regulations were adopted, some sellers were found to be working with selected appraisal companies to inflate prices to the $250,000 threshold so that buyers could secure citizenship.

Most of these new builds are also being sold off-plan, and because of the lira’s meltdown and the increasing cost of project financing and construction, many projects have been postponed or slowed to a crawl. (In the past few months, the prices of rebars and concrete, two vital materials, were up by 70% and 44% respectively.)

Istanbul viewed from the air reveals a huge amount of high rise construction sprawling out from the city.

On the risk scale, this likely doesn’t deter an investor from Iran or Russia who wants to move money overseas. However, for Westerners, it’s unnecessary risk.

There is a reason to buy here of course. Like I say, the lira has lost almost 50% against the dollar over the past year, giving foreign currency holders a lot of buying power.

What you get in Istanbul is a city that feels a lot like a European city, but offers you Asian prices. A budget of $75,000 to $200,000 goes a very long way, even in some of the most popular districts in the city.

North of the Bosphorus Strait is culturally closer to secular Europe than it is to Turkey’s capital, Ankara. It has a thriving café culture that could rival Milan or Budapest, and a good nightlife (alcohol is the one thing here that isn’t so cheap).

On a final note, in case you’re wondering how the date with the Russian real estate investor went, here’s what happened:

The Turkish driver and owner of the property took us to a neighborhood called Ikitelli. It’s a suburb about 20 minutes’ drive from the center that was built in the 1980 to help house industrial workers. It was a little grotty, but well serviced with decent transport connections and right next to the Mall of Istanbul, one of the biggest malls in Turkey.

The $19,704 apartment was surprisingly large and had a sizable terrace, but that’s the best I can say for it. Wires hung out of the walls, the gas units looked jury-rigged, and the floor was “wavy.”

Later the owner invited us to his apartment for a Turkish coffee—something you can’t refuse here. But this was where he made his fatal mistake. As we sat in silence across from his entire family, he spoke openly to them about the deal. What he didn’t know is that my date is a Tatar, an ethnic minority in Russia who speaks a dialect of Turkic and could understand a few words of what he was saying.

A mention of “debt” soured her completely on the sale. Instead, we headed back into the city for hookah and drinks.

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