Sales of real estate to foreign companies in Turkey

Sales of real estate to foreign companies in Turkey

Turkey's Constitutional Court decides to annul a law allowing sales of real estate to foreign companies. According to Finance Minister of Turkish government Kemal Unakitan

"This decision does not help our efforts to attract foreign investors into Turkey,"

In the article of Guardian which depends on Reuters news about the sales of real estate to foreign companies stated that " The Constitutional Court ruling, which cannot be appealed against, on Wednesday cancelled a law allowing sales of property to companies established by foreign investors or joint ventures involving foreign firms."
The court ruling will come into force six months later following its publication in the Official Gazette.
The deals which are already made will not be affected from the latest development.
According to Wolfango Piccoli, an analyst for Eurasia Group, said that

"While the government is expected to make new changes in the title-deed law before the ruling comes into force, the decision by the court is certainly negative."

Economists fear the ruling could scare off investors in the real estate sector at a time when foreign direct investment (FDI) is most needed to protect the $620 billion economy from global financial turbulence.
Turkey attracted $22 billion in FDI in 2007 and expects to receive more than $20 billion this year through privatisation and greenfield investments as well as real estate sales ahead of the ban.
Turkey's real estate market has seen a boom in recent years, helped by a young and fast-growing population, economic growth averaging 7 percent a year, foreign buyers and prospects of European Union membership.
"Foreign investors' real estate purchases amounted to around $2.9 billion in 2007, an important part of FDI that is the main financing tool of the growing current account deficit."

Source: www.guardian.co.uk