Turkish citizenship through real estate investments: the easy way out

>To print this article, all you need to do is register or log in to Mondaq.com. When acquiring Turkish citizenship, investors usually prefer to use a bank deposit (equivalent to $500,000 in Turkish lira) or a real estate investment ($400,000). However, there is another alternative - real estate investment funds.

1. Introduction

Investments in real estate and bank deposits are the most commonly used types of investments when acquiring Turkish citizenship by investment. However, real estate investment funds are a lucrative and safer alternative in some respects. Foreign investors can acquire Turkish citizenship by investing at least $500,000 in real estate investment funds. Real estate investment funds have significant advantages over real estate investments and bank deposits.

2. What is a real estate investment fund?

In a real estate investment fund, a fund manager raises capital from many investors and creates a portfolio of real estate investments. These funds are regulated by the Turkish Securities Authority. Investors own a stake in the fund or, more simply, a share in the fund's real estate portfolio.

3. Advantages of investing in real estate investment funds

• 3.1. Highly regulated and market controlled
  Portfolio and real estate management companies can establish a real estate investment fund with the supervision and control of the Turkish Securities Authority. The Securities Division continually monitors the fund's activities. Properties in the fund's portfolio are evaluated by government-accredited experts at the time of acquisition and at periodic intervals.
• 3.2. There are no legal restrictions for any citizens wishing to invest
  Some citizens are prohibited from buying real estate in Turkey, such as Syrian citizens. In addition, the purchase of real estate by some citizens requires authorization from the Ministry of Interior. However, there are no restrictions for any nationality to invest in real estate investment funds.
• 3.3. Investments usually rise in parallel with rising real estate prices
  Deposits in a bank to apply for citizenship must be in Turkish lira. Investors can use currency-protected deposits, where the government guarantees the account holder a higher interest rate promised by the bank or the equivalent of the deposited amount in US dollars.

4. Disadvantages of investing in real estate investment funds:

• 4.1. Annual management fee
  Investors pay an annual management fee to the fund management company. This can be a fixed amount or a percentage of the investment amount. Depending on the type of fund, management fees vary from 1,100 Turkish Liras to 2% of the investment amount.
• 4.2. Shares can only be sold at certain times
  Investors wishing to sell their shares may have to wait for sale periods determined by the fund management company. This usually happens twice a year.

CONCLUSION: It is recommended that investors wishing to apply for Turkish citizenship should also consider investing in real estate investment funds as an alternative. Published September 5, 2022. The content of this article is intended as a general guide to this topic. It is recommended that you consult an expert regarding your specific situation.