What is Rental Guarantee?
A rental guarantee is a system in which a party looking to buy a property for renting it out for a night or weekly in terms of retail basis. Generally, a property manager or holiday rental manager rents the property from the owner for a long period, typically for a few months or years.
The property manager provides the property owner with a guaranteed amount throughout the contract. The manager then has the right to rent the property out for commercial reasons and keep all of the revenues. This system is common among those who want to reduce the risk of renting property, such as residential projects, commercial units, and hotel apartments.
How does a Rental Guarantee Work?
The rental guarantee program is for individuals looking for a guaranteed return over a predefined period and it is offered to clients by private contracting firms.
For the property owners, a rental guarantee return eliminates the risk of renting the property by themselves. The owner can also transfer the expenses, maintenance, and other property owner responsibilities to the new property manager during the term of the contract. This depends on how the contract is constructed.
The property manager can purchase new material to manage for commercial reasons through a contract and generate revenue. Contracts like these can boost profit margins if purchased at the proper price. The manager has more control over how the property is managed by purchasing the months during the period.
The rental guarantee contracts are categorized into two types as follows:
- Bilateral Contracts: Bilateral contracts are negotiated between the property owner and property manager for wholesale rentals. These contracts can be beneficial when two parties trust each other and agree on the numbers.
- Marketplaces: Wholesale rental marketplaces help property owners and property managers reach an agreement. Property managers compete against each other in marketplaces, bidding up the price and paying property owners. These markets make it fast and easy for property owners and managers to come to an agreement and sign wholesale rental contracts by establishing market-derived pricing for properties’ rental months.
How are Rental Guaranteed Property Prices Determined in Turkey?
Rental guaranteed property prices are determined by several factors in Turkey as listed below.
- Property Location: The most important factor in determining the price of a rental guaranteed property is its location. The higher the property price, the more exclusive the location is. A property that has easy access to public transportation will cost more than the one located far from transportation hubs. The rental guaranteed property’s location in the city such as being located in a financial center or shopping complex affects determining the price in Turkey.
- Property Size and Features: The size and features of the rental guaranteed property, as well as the facilities provided in the estate, have a role in determining the price of the property. Bigger properties with numerous features will most likely have a higher price than standard properties.
- Property View: The rental guaranteed property’s view is another crucial factor that influences the price in Turkey. While a sea view property is the most valuable, other views such as the city skyline have an impact on pricing as well.
What are the Price Ranges of Rental Guaranteed Property in Turkey?
The price of a rental guaranteed property in Istanbul, Turkey ranges between US$505,000 and US$1,343,000 for 1+1 to 4+1 hotel type apartments. On average, rental guaranteed offices in Istanbul cost US$305,400. Rental guaranteed commercial shops in Istanbul range between US$295,471 and US$1,532,000.
In Alanya, rental guaranteed hotel apartments cost about US$123,000 on average.
What are the Advantages of Buying a Rental Guaranteed Property in Turkey?
Turkey’s real estate industry is expanding rapidly. Foreign investors from other countries are continuing to buy rental guaranteed property in Turkey and profit from high rental incomes consistently. The advantages of buying rental guaranteed property in Turkey are listed below.
- Turkish Citizenship: Any foreign investor who purchases a property in Turkey for US$250,000 can apply for Turkish citizenship and receive a passport that can be used worldwide. In just six months, foreigners can become Turkish citizens. Rental guaranteed properties can be used to obtain Turkish citizenship, as well as Turkish residency.
- Low Risk: A rental guarantee return reduces the risk of the property owners renting the property on their own. During the period of the contract, the owner can also shift costs, maintenance, and other property owner tasks to the new property manager.
- High Return on Profit: Having a rental guaranteed property in Turkey is a good decision. Turkey is one of the greatest and safest countries for long-term investment, with a well-developed real estate market and prospective projects throughout the country. The property manager can use a contract to purchase additional material to manage for commercial purposes and make a profit. If obtained at the right price, contracts like this can help improve profit margins.
- Low Property Taxes: Turkey is becoming more accessible to foreign investors who are interested in rental guaranteed property in the country as the country’s tax policies align with international standards. Managing a rental guaranteed property in Turkey will result in reasonable tax payments since the tax rates are set based on the value of the property.
- Rich in Projects: Turkey’s real estate industry continues to grow at a significant rate. The increased demand for real estate, pushed by an increase in the number of construction projects, has resulted in world-class performance standards. There are numerous residential and commercial properties in Turkey, providing rental guarantee programs in various locations.
How Much Profit Can Be Made with Rental Guaranteed Property?
The profit of a rental guaranteed property depends on the terms of the contract. For example, a property bought for US$100,000 with a 5% of guaranteed rental return for 5 years will generate US$25,000 of rental income for that period, meaning US$5,000 revenue each year. The rental rate and the period differ depending on the property type and its project.
Can I Become a Turkish Citizen by Buying a Rental Guaranteed Property in Turkey?
Yes, there are several ways to obtain Turkish citizenship, and buying rental guaranteed property in Turkey is one of them. You can become a Turkish citizen by investing a minimum of US$250,000 in rental guaranteed property in Turkey. The buyer’s family, including children under the age of 18, will also have the opportunity to become Turkish citizens. Foreigners can become Turkish citizens within 6 months following the application. They can use the benefits of a Turkish passport anywhere around the world.
Who can Buy a Rental Guaranteed Property in Turkey?
Foreign investors from almost every country in the world can buy rental guaranteed property in Turkey. The only nations where investors are forbidden from buying rental guaranteed property in Turkey are North Korea, Cuba, Nigeria, Syria, and Armenia.
Citizens of Jordan, Israel, Fiji, and East Timor are subject to certain limitations while buying property in Turkey.
Investors from Russia and Ukraine are not permitted to buy property along Turkey’s Black Sea coast. On the Black Sea coast and in some Aegean areas, Greek citizens are unable to buy real estate in Turkey.
In Which Cities Can I Buy Rental Guaranteed Property in Turkey?
Rental guaranteed properties can be found in many locations in the country. Here is a list of cities you can buy rental guaranteed property in Turkey.
- Istanbul: Istanbul is the heartbeat of the real estate market in Turkey. From hotel apartments to commercial properties, Istanbul offers a wide range of rental guaranteed property options. Some of the top districts to buy rental guaranteed properties are Basinekspres, Esenyurt, Bahcesehir, Beylikduzu, Kagithane, Kadikoy, Sariyer, and Buyukcekmece.
- Bursa: Rental guaranteed properties in Bursa are great for investment in terms of rental income. Rental guaranteed residential projects can be found in the Nilufer district.
- Antalya: Rental guaranteed properties in Antalya are perfect for holiday rentals and they are foreign investors’ top choice in Turkey.
- Alanya: Alanya is another holiday destination in Turkey and is home to many rental guaranteed properties.
- Izmir: Rental guaranteed properties in Izmir offer great value and high rental returns on the Aegean coast of Turkey. You can find 5-star hotel concept properties with well-known worldwide brands.
- Bodrum: Beautiful villa-style properties in Bodrum attract foreign investors looking for style, luxury, and a sophisticated ambiance from a house.
- Sakarya: Located between the Black Sea and Istanbul, rental guaranteed properties in Sakarya are offering affordable alternatives compared to other cities in Turkey.
- Mersin: Rental guaranteed properties in Mersin are inexpensive and can make great investments.
How to Manage Rental Guaranteed Property?
After buying rental guaranteed property in Turkey, property management is the most crucial stage. Investors who consider entering the Turkish real estate market are unsure of how to continue. While some choose to manage property individually, others find the process difficult and risky, so they choose to partner with a specialized real estate investment management company.
Real estate investment management provides investors high-quality management and guidance over rental guaranteed properties and with the right property management, you can secure a high return on investment.
Realty Group’s property management services for the rental guaranteed property will not only provide a great rental guarantee program after buying the property but also assist you to the finest and most advantageous deals that maximize your income and manage your rental guaranteed property.
Is it Safe to Buy Rental Guaranteed Properties in Turkey?
Yes, buying rental guaranteed properties in Turkey is safe. Purchasing a rental guaranteed property from Realty Group projects in Turkey is a hassle-free and reliable method that has been used by many clients for over a decade.
Is There a Rental Guaranteed Property Tax in Turkey?
Rental guaranteed property tax is a type of tax placed on real estate that is owned by an individual or a business. Property tax in Turkey is 2% and both of the buyers and sellers must pay it when the real estate is sold. These fees are equal to 4% of the purchase price and are depend on a property evaluation report.
Owners of apartments in metropolitan areas are required to pay 0.2% in annual property taxes and 0.1% tax applies to properties located outside of a metropolitan area. The annual real estate tax on commercial properties is 0.4% in big cities and 0.2% in small areas. Taxes can be paid to local authorities online.
If you own a property in Turkey, you are subject to pay income tax on your rental income under Turkish tax law. The tax is paid twice a year in equal installments to a bank or the Tax Chamber. The amount of income tax is determined by the volume of your rental income.
Do Foreigners Pay Rental Guaranteed Property Tax in Turkey?
Yes, foreigners who own rental guaranteed property in Turkey are required to pay property tax. Anyone who owns a property in Turkey, including foreign investors, is subject to pay property tax.
What are the Features of Rental Guaranteed Properties in Turkey?
Rental guaranteed property features are a set of distinctive aspects that identify the property and they are divided into two sections: residential complexes and commercial real estate.
A residential complex is a facility that contains a building or a set of buildings and provides residents services, sports fields, social areas, and shared leisure spaces. Commercial properties, on the other hand, include offices, shopping malls, and industrial facilities. Both residential complexes and commercial properties offer excellent investment opportunities and rental profit with the rental guaranteed system.
Apartments are found in skyscrapers and multi-story buildings. Duplexes, triplexes, and penthouses are examples of luxury apartments. Rental guaranteed properties are constructed with high-quality materials and smart home systems. These properties are centrally located in the cities of Turkey, surrounded by shopping malls, education centers, hospitals, and main transportation hubs and have panoramic views of the city or sea.
The hotel apartments are usually situated in residences and divided into two types: 1+1 and 2+1, including furniture. 5-star hotel services, such as cinema room, meeting room, reception, valet, spa and fitness center, housekeeping, car wash, 24/7 security, room service, underground parking, swimming pool, are provided thanks to the hotel apartment concept.
Rental guaranteed properties in Turkey, especially in Istanbul, are not only prestigious projects but also have incredible rental guaranteed systems.