Istanbul comes out on top again as the best bet for 2012
For the second year running Istanbul has been ranked as the number one growth city for property investment for 2012, according to the latest report from PricewaterhouseCoopers. The annual ‘Emerging Trends in Real Estate’ report is produced by PWC in association with Urban Land Institute and analyses top European property markets using surveys of investors, brokers and money managers, to predict the trends for the coming year.
Istanbul has retained its top ranking with industry confidence in the city at a high and the prospects for property development and investment seemingly endless. Turkey’s booming economy and young population, together with the growing tourist demand for holiday rentals, have all contributed to Istanbul’s impressive ranking. Other cities set to do well this year are Munich, largely due to strong local economic and employment stability, and Warsaw thanks to its improving status on the world financial markets stage.
Berlin, Stockholm, Hamburg and Zurich also made it onto the list as safe cities for investors to target, but London slipped from second to tenth. Investor confidence in the UK’s capital has significantly dipped, in part due to the ongoing economic turmoil and stagnating growth figures, as well as the overriding view that property there is simply still too overpriced. While Paris also moved down the list its fall was more gentle than that of London as it is less reliant on financial services and the banking sector. Simon Hardwick, a Partner at PwC, commented that “London has become full priced due to strong demand for a safe haven but some might say overpriced”.
The report highlights that London is regarded as being “too expensive for the economic outlook” and investors “complain about the difficulty in getting hold of assets, strong competition and bubble-like pricing”. The European cities mentioned above are much more appealing to investors, being in relatively safe economic markets and offering much more value for money. However, it was also stressed that the European property market is in something of a limbo situation thanks to the crisis in the Eurozone and global economic pressures. As John Forbes, Real Estate Partner at PwC pointed out, “It’s going to be a volatile market across the board. Investors realised there is no point in hanging around and waiting for an upturn because there wasn’t one coming”.
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