Should You Invest In Turkey?

What’s the most important moment in the history of Western civilization?

You’ll get many answers from different historians…

But surely one of the most crucial moments is the fall of the city of Constantinople in 1453.

Not many people… particularly outside of Europe… know the full story of Constantinople, capital of the Byzantine Empire.

It began as “Nova Roma,” New Rome, and was the chief city of the Roman Empire on the far side of the Mediterranean from Italy.

At its height, the Roman Empire stretched not just all across Europe; it possessed all the territory that touches the Mediterranean Sea.

In 330 A.D., New Rome was named the capital of the Empire, taking the place of the city in Italy, which had been the seat of Roman rule for a thousand years…

The city was renamed Constantinople, after Constantine I, the first Roman Emperor who was a Christian.

And now the Roman Empire entered a new epoch…

A century and a half later, Old Rome fell to the barbarians and the Western Roman Empire collapsed…

But the Empire didn’t die… it continued on the far side of the Mediterranean, in the lands surrounding Constantinople…

For the next 1,000 years, Rome lived on in the East…

Today, historians call this the reign of the “Byzantine Empire,” to distinguish it from the Old Roman Empire centered around Italy… But the “Byzantines” (Byzantium was the name of the city before it became New Rome) would not have recognized those words.

The citizens of Constantinople and the Byzantine territories called themselves Romans… Roman citizens… and saw their way of life as a continuation of what the Roman Empire had always offered…

On May 29, 1453, a civilization that had lived for two millennia was finally undone.

After a siege lasting more than a month, the army of the Ottoman Empire breached Constantinople’s walls and sacked the city… New Rome had fallen.

The Roman Empire was dead.

Travel the lands around Byzantium today and evidence of history and past glory is everywhere…

Parts of the city built by Constantine I, the city he made into New Rome, still exist… and layered on top of it now is the history of the Ottoman Empire… and, of course, the modern nation of Turkey.

This is what I really want to talk about.

Constantinople, today called Istanbul… capital of two of the greatest empires in history (the Romans and the Ottomans)… the largest city in Turkey… and still the largest city in all of Europe.

Turkey… its past, present, and future… is on my mind.

I was watching Turkey’s elections closely last weekend.

On Sunday, May 14, Turks went to the polls to elect a new parliament and new president, with turnout higher than 93%.

The presidential contest will go to a run-off election on May 28, after neither of the top candidates, incumbent Recep Tayyip Erdogan or united-opposition challenger Kemal Kilicdaroglu, secured more than 50%

Turkey is a country that could be… and maybe one day will be… near the top of the list of overseas havens we cover at Live And Invest Overseas.

It’s a country that was founded to be secular, with a separation of religion and government (like the U.S.); to protect rights and freedoms.

It has nearly 1,000 miles of Mediterranean coastline… Roman ruins and other historical monuments everywhere… bustling, culture-filled cities and idyllic rural retreats… a low, low cost of living, and some truly stunning property buys…

Not to mention, you have easy connectivity to both Europe and Asia in this vast nation that straddles two continents…

Turkey has so much to offer the potential expat or overseas investor… but everything that draws me to it remains, for now, tantalizingly out of reach.

That’s not to say that the right deal, the right location for your personal preferences, can’t be found. Of course it can. As I say, Turkey is a huge country with so much to offer…

But Turkey is also a reminder… as if we needed it in the States… that who’s in charge matters. Presidents matter. Governments matter.

Turkey in recent years has not seemed much interested in attracting expats and overseas investors… indeed, the government has shunned influence from outsiders… there’s even a rumor that the country’s citizenship-by-investment program (purchase a US$400,000 property and get a Turkish passport) will be shuttered if the incumbent president is re-elected.

Inflation is bad in America at around 5%, two and a half times the Fed’s target rate… but consider the Turks, who are seeing inflation currently stand at an eye-watering 55%.

Of course, those kinds of numbers can be an advantage to Turks overseas earning in another currency, or expats earning in, say, euros or dollars but spending in lira… but they also indicate an economic situation that’s not sustainable.

Those are the kinds of numbers that would make you worry about making an investment in property or anything else… How likely are you to see strong rental returns or capital appreciation in an economy this seriously challenged?

It’s not impossible… many parts of Turkey, like Antalya and the Turkish Riviera, are to some extent economic bubbles, protected from the rest of the country’s troubles thanks to the tourist trade…

But the 7.8 magnitude quake that hit Turkey and Syria in February—although far from the Riviera—will likely have some knock-on effect on tourist numbers for quite a while.

That quake also brought a lot of criticism on the government, due to lowered building standards that meant more buildings came down…

Turkey is such a field of opportunities, waiting to bloom.

I’ll keep searching for the right play here…

Or the right time to make a play…

And I’ll once again be following the election results with great interest on May 28.

Watch this space.

Stay diversified,

Lief Simon
Editor, Offshore Living Letter