By: mytapu webmaster | June 06, 2020

Risks and Costs of Citizenship Investment in Turkey for Investors' Capital and Consultants' Brand Value...
Risks and Costs of Citizenship Investment in Turkey for Investors' Capital and Consultants' Brand Value...

With transactions costs of Citizenship by Investment in Turkey ranging as high as 20% or more, the true costs are investor dissatisfaction and accompanying brand reputation damage of advising consultants.


Citizenship Investors Talk Openly… and Word Travels Fast & Far…

Amongst their associates and friends, in their network circles, they openly discuss the merits and concerns of their choices. The interactions with advisors are relayed back into their networks. The networks overlap, and interlink. Word travels fast. In this way, a Citizenship Advisory consultancy gains a voice for their brand name. That brand reputation can easily suffer irreparable damage from dissatisfied investors in Turkey…

In a citizenship applicant’s network, there are several like minded investors, at different stages of their decision making. When an applicant some weeks or months later discovers the investment made is worth 10% - 20% less than what they paid, that loss has a damaging impact on new business for the advisors brand. No amount of advertising will rectify this impact on the future citizenship applicant’s decision making.

 
‘Commission ‘Gold Fever’ is Everywhere…

 

The many merits of the Citizenship by investment program in Turkey have attracted international citizenship advisory consultants from around the world. A quick scan of their internet advertising reveals scant previous experience of business conditions or operating experience in Turkey.  Of course, they may rely on legal advisers in Turkey. Like the real estate lawyers and agents charged with real estate purchasers, the attraction of large commissions and ‘hidden price mark-ups’ governs every action, like ‘gold fever’ during a gold rush. The international firms can not know what really goes on ‘behind the scenes’, during a real estate purchase, beyond attaining a superficial perspective and understanding.

 

With more than 30 years managing investments in Turkey, the professional service providers at mytapu.com do have a very clear idea, gained from advising on more than 3,000 real estate transactions for foreign investors. International citizenship advisory consultants may be interested to know this team at mytapu.com openly welcomes executing business to meet the procedural and business model criteria of their clients’ businesses… The professional service providers at mytapu.com are a reliable solution for preservation of clients’ wealth capital, and protecting international advisors’ brand value

 
Inflated Transaction Costs are the Biggest Risk…

 

There is no question, the biggest risk for an applicant to the citizenship investment program in Turkey, is the transaction cost risk. More than 85% of all foreign real estate investors in Turkey have over-paid for the property they purchased. The over payments occur in the form of apportionment of taxes, commissions, other related transaction costs, and the big one - hidden price mark ups.

 

No citizenship investor in Turkey need be unduly concerned about the citizenship application risks. The program is very well designed, so that the risks are minimised, negligible, and nearly non-existent. This holds true for all the stages, of pre-qualification criteria, application submission, application processing, and passport granting.

 

Brand Reputation of Advisors is being Destroyed…

 

The primary, key risk is the investment risk, specifically the transaction management, and transaction costs. What happens when an investor discovers the price paid for a property is 10% to 20% above the market value, in a market where prices have been falling for three years ? The one thing that is sure to happen, is the dissatisfaction expressed to associates and friends, in their overlapping networks. That dialogue will destroy and is destroying international citizenship consultants’ brand reputation and value….

 

Any doubt about how this works? The history of this collusion in Turkey is long and wide spread, over the previous decade, and may be ‘news’ only to the newly advising international consultants. The foreign investors have been complaining for years.  Turkish developers' sales agents have long been the subject of criticism and litigation on this count, both in Turkey and abroad.

 

The primary reason this occurs is because there is no regulatory framework in Turkey governing real estate purchasers by foreigners, and consumer protection laws are essentially very limited in comparison to many countries. In addition, the lawyers and estate agents and consultants based in Turkey, with the exception of top tier corporate consultancy firms, have no bonafide experience, knowledge, or expertise providing advice for investment, as the term has come to mean, in most OECD countries.

 

In this way the international consultancy and the local Turkish counterparts they delegate to, are incapable of providing professional investment advice about how to manage various investment risks. These include the Turkish Lira currency risk, duration risk (3 years), liquidity risks, counterparty risks, contract risks, and the whole extensive range of risks related to purchasing a single residential property, or a commercial property.

 

 
Preservation of investors’ Wealth Capital is Protecting Advisers’ Brand Value & Reputations…

 

Fortunately the team of professionals at mytapu.com are the professional services arm for real estate investment of a foreign private equity investment management firm. The services provided adhere to the gold standard of best practice known as ‘London Standards’ in professional private equity circles. These institutional quality services have been provided to international investment fund managers, and are also offered to individual clients for single residential real estate purchases and sales.

 

As professional investors actively advising Turkish and international corporates in Turkey since 1987, a wealth of know-how (knowledge, experience, and expertise) is available on non-real estate investments. These alternatives for citizenship investors in bank deposits, investment funds, and direct private equity investments, have many benefits. Eliminating Turkish Lira exchange rate risk is one  Diversification into more attractive investment returns is another. Assessment of investment fund risk, performance, and management. Managing duration risk, with the technique of switching the investment asset during the three years duration holding period is another. And there are more…

 

International citizenship advisory consultants may be interested to know this team at mytapu.com openly welcomes executing business to meet the procedural and business model criteria of their clients’ businesses…. With more than 30 years experience in Turkey managing direct investments, capital market and investment fund investments, and more than 3,000 real estate transactions for foreign investors, the professional service providers at mytapu.com are a reliable solution for preservation of clients’ wealth capital, and protecting international advisors brand value.

 

Enquire today to learn more by email to info@mytapu.com and include a WhatsApp or Viber number to receive a complimentary call back…


 

Additional Reading for Buyers:


Residential Property Investors Tool-Kit for Turkey

Property Finders Service Istanbul and Coastal Turkey,

Citizenship Investment in Turkey

Conveyancing

The One Source for Every Turkish Mortgage

Legal Services for Property Matters in Turkey

Advice for Property Matters in Turkey 

Valuations

Property Price Histories in Turkey



 Why Istanbul Lifestyle Retains its Allure for Real Estate Investors…

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