best sectors for investment in istanbul

Editor Istanbul

May 23 246 read

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Best Sectors for Investment in Istanbul:

Turkey has one of the fastest-growing economies in the world with an average GDP growth rate of 5.1%, and it is an ideal country to invest in many foreign and domestic investors due to its qualified workforce, its favorable investment environment, the incentives that the Turkish government constantly offers, taxes Discounts, waivers, and many other things.

But, if you are confused about choosing the most profitable and reliable investment field in Turkey, here are the most ideal investment sectors in it.

1- Real estate:

Real estate investment has become one of the most interesting and profitable sectors in recent years, as foreign and local investors are making a high return on real estate investment in Turkey, especially in cities like Istanbul, Izmir, Antalya, and Bursa. During June of this year, sales of residential properties to foreigners recorded an increase of 43.7 percent compared to the same period in the previous year, where the number of homes sold reached 20,488 TUIK homes. The ease of foreign investment in real estate in Turkey lies in the fact that the foreign investor does not need a residence permit to be able to buy a property in Turkey of any kind, and if the value of his real estate investment is 250.000 US dollars or more, he and his family are entitled to apply for Turkish citizenship.

But, why is real estate investment in Turkey a distinctive investment?

Here are the most important reasons for real estate investment in Turkey:

1- Real estate prices are acceptable: real estate prices in Turkey are still competitive compared to other countries such as Spain, Portugal, and Greece.

2- Low cost of living: The average cost of living in Turkey is 54.77% lower than in the United States, and the average rent in Turkey is 82.47% lower than in the United States.

3- Profitable for investors: Despite the urban expansion in Turkey, the demand for real estate still exceeds supply, and this leads to a high return on sale or rent.

2- Tourism:

Turkey ranked sixth among the best tourist destinations in the world, attracting more than 46 million visitors in 2018. With its unique location, charming places, huge and sophisticated projects, and others, the tourism sector in Turkey continues to grow more and more. The Turkish government offers many incentives for those wishing to invest in the tourism sector and is working to reduce the tax burden and pursue policies aimed at removing any barriers that might harm investors or may prevent the tourism sector from growing.

3- Cars:

Turkey is one of the largest car manufacturers in the world with around 415 million cars produced between January and April 2021 in Anatolia. The automotive sector has become a major role in the Turkish economy, and Turkey has also become home to many global suppliers. There are more than 250 global suppliers who use Turkey as a production base. During the past five years, Toyota increased its production in Turkey by 95 percent, and Ford by 95 percent. 52 percent and Fiat's production increased by 35 percent. This is what makes Turkey a magnet for many foreign and local investors.

4- Energy:

Turkey is an attractive market for energy companies and investors in this field due to the provision of many incentives in the energy sector and natural resources and the increase in demand for them through the economic and population growth in Turkey. Therefore, the Turkish government plans to increase the proportion of renewable energy resources (solar, wind, hydropower, geothermal, and biomass) in the total installed capacity to 30% by 2023 so that the total investment needed to meet Turkish demand is expected to reach about 110 US$1 billion, more than double the total amount invested over the past decade.

5- Financial investments / in start-up companies:

Turkey has one of the most efficient and skilled workforces in Europe, the Middle East, and North Africa with around one million university students graduating annually in Turkey, including more than 40,000 engineering and engineering trade graduates. While the Turkish startup ecosystem reaped record investments of about $137 million in 2020, the investment figures in the first half of 2021 have crossed the $1 billion thresholds, setting a new record for this year. Turkey supports foreign investors and they are highly welcome to invest in Turkish startups, either by direct investment or financial investment to benefit while the successful startups go global.

6- Agriculture and Food:

The Turkish agricultural and food sector is considered to be a very successful sector thanks to the favorable geographical nature and climate of Turkey. Turkey has become one of the best countries in supporting and developing such investments and aims to become one of the top five producers in the agriculture and food sector by 2023, it offers a series of incentives to foreign and domestic investors in the field of agriculture and food. As for the agriculture and food sector, the Turkish government maintains incentives for investors, reduces the tax burden on them, and secures a skilled workforce at competitive prices.

Turkey is the leading country in the production of hazelnuts, dried apricots, dried grapes, and dried figs. Also, Turkey happens to be the strongest producer of milk and dairy products such as yogurt, cheese, kefir, and ayran in the region. Globally, Turkey exported about 1,800 types of agricultural products to more than 190 countries in 2020, with an export volume of about $18.8 billion.

7- Information technology:

The ICT sector is a priority sector in Turkey as there are more than 2,000 companies active in the ICT field in Turkey. The Turkish government is taking various initiatives to boost the technology sector in the region and supports these investments. It also provides a package of incentives to foreign and local investors, which include corporate tax breaks, value-added tax exemptions, social security premium support, and more. That is why international investments estimated at $18 billion have been attracted to Turkey since the beginning of 2000.

Finally, each of the areas we mentioned above may have several advantages and disadvantages, so you should define your expectations and investment goals, consider the potential gains and losses that you may face later, and know how to deal with them. And remember that time is an investor's best friend, which means that long-term investments are safe and less risky than short-term investments, as they can protect you from losses caused by market volatility and may facilitate compensation for potential losses on your investments.