Calis Beach and Fethiye Turkey Discussion Forum
Calis Beach Forum => Expat & Property Owners Q and A Forum => Topic started by: mike77777777 on June 17, 2011, 09:04:58 AM
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The more I am reading about moving to Turkey it seems many people are suggesting keeping a home in England and renting out. I was thinking that with such good interest rates in Turkey and government guarantees for savings to a certain level and 100% guaranteed government bonds. ( I know this means keeping several bank account to protect all your money) it would be more profitable to put the bolt hole money in the banks in Turkey and then if you return home you would have made more money and would buy a house with the cash. Am I missing something important here besides the fact the exchange rate and inflation could change. Is it just that keeping a bolt hole is a pesimistic approach based on gut feeling of familiarity with home or are there good sound factual based reasons for doing this. Has anyone experienced moving everything and returning to find they can't afford what they used to have. What do you think...
BFN Mike
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I kept a bolt hole all be it cheap & cheerful but its close to a uni ( your hometown in fact) and so will be easy to rent.
Interest rates aren't guaranteed and rental income will be higher than interest and UK property prices will almost always rise as a long term investment.
I'm naturally very cautious and wasn't brave enough to sell everything just in case.
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You & I are exchanging identical emotions at the moment Mike!
I have pondered this greatly & last night decided that the lure of 10% interest outvalues letting my flat here in Brighton (unfortunately I still have a small mortgage on it) to someone I don't know via an agent who is taking 10% of the rent for his "trouble". I have done my sums & if I sell up I can live happily in Calis without touching my capital in the bank. This would give me my "bolt hole" money should I decide to return to the UK at any time in the future, the interest rate can drop as low as 5% & I would still be in front financially.
1 thing about renting your home here in the UK is that if it's mortgaged you have to declare this to your lender & they charge for then having a buy to let facility & according to my local estate agent I would have to have seperate landlords insurance, an epc (not expensive I know) & several other bits of paperwork/headaches to do it 100% legally not counting the possible damage caused by a naff tenant & 2 months deposit wont always cover this if they really go to town.
My decision is made, I am going to sell up here in the UK & rent for a year in Calis then decide what to do from there, good luck with whatever you decide, am sure this amazingly helpful forum will provide many answers for you.
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I sold in Brighton, bought in Portsmouth, now mortgage free and balance earning over 8%. Not using an agent, all you need is available online,tenancy agreements etc and being Uni rental I can use the house in the summer and redecorate as necessary!
I cant get 10% here, only in Orange account for first month, but would be pleased to know where I can get it! This Governments target is to reduce interest rates quickly, and when you think what they were last year, all of this made me nervous.
I actually envy your go for it mentality, good luck and hope its everything you wish for x
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House paid for so no mortgage problems. Have rented out properties before and had some awful tenants. Proper scum of the earth and the law is balanced in their favour. My next approach to tennants like that would be a baseball bat. So maybe I could end up in trouble. What sort of interest rates do you get in general from your savings in Turkey. I did read the current government is trying to reduce interest rates there but it's a booming economy with a massive trade defecit which I suspect is not helping them to do this easily. I would always keep a close eye on rates and move finances where I thought best. Which could include the safest bet as I don't want to take big risks. I too could manage just on capital saved. Then when I get my pensions in 13yrs I will be very happy.
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Don't forge to factor in FX rates if you decide to take your money out of Turkey and return to the Uk - could loose you a pretty penny
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Hi Gorgeous Bird.. yes I would keep a close eye on all aspects of financial situation.... thanks for advice.
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quote:
Originally posted by Gorgeous_bird
Don't forge to factor in FX rates if you decide to take your money out of Turkey and return to the Uk - could loose you a pretty penny
Or you could make a pretty penny if the FX rates move in your favour
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Hi Liz 101 . yes it probably says in the small print that things can go up or down...
I suspect the long term would show sterling being the stronger currency...
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The one piece of advice that I would give you is to think carefully about living off interest. As stated earlier it is Turkish government policy to reduce interest rates and add to that an inflation rate of about 8% you could find your capital depreciating very quickly. If you were to have a serious health problem and needed an operation then you could see some of your capital disappear.
If I was going to try and live in calis for a year and then make a decision I would hold on to what you have got in the UK until you are sure it is what you want to do. It is a tough decision as the housing market in the UK is so uncertain.
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Lots of very good advice, thanks, keep it coming.
I think it depends on your personal mentality which you prefer - 10% now with a possibility it will drop against a certain 2% in the UK. Another way of earning some extra is to play the exchange rate, this takes time & effort but can add a "bonus" income if needed.
Another factor is the total you have to invest, like many on here I've worked for a long while & a not necessarily a gambler but to refuse 10% now might seem short sighted, damned if you do, damned if you don't!
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Supacabby please think very carefully about playing with exchange rates. Having spent many years in the Treasury division of a large financial institution all I can say it takes expertise to speculate. It could also lead to losses. Markets are still full of uncertainty and not the best time to speculate.
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not selling anything at home until the year is up. We can then decide what we want to do. We can see if the interest rate goes below the present level over that year. I'm not a gambler but looking at their economic situation I suspect it is more likely to rise than fall.
Not so sure about the exchange rate. I think that will depend more upon US and GB recovery.
keep the comments coming..
Thanks Mike
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It was only a month or so back Erdogan was (according to some Turkish papers) wanting bank interest rates for savers to drop in time to 0%. As he believes people should work and not rely on interest from savings. In reality I would be suprised if this happened, but as he is back in power for another 4 years, who knows what will happen!
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I would not worry about the recovery of the UK and America, I would worry about what could happen to the Euro. There is an election due in Spain and it is shortly after when the true state of the Spanish economy will come out. A bail out of Spain will makePortugal, Ireland and Greece look like small change. There is a possibility that the Euro may not survive.
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Me thinks Supacabby has already made up his mind and not so much looking for advise but endorsement of what he's already decided eh?
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quote:
Originally posted by hillside
Me thinks Supacabby has already made up his mind and not so much looking for advise but endorsement of what he's already decided eh?
Not quite, I still have the option to rent my flat or sell it, just trying to do what's best in the financial long run & also make sure I can live comfortably without an income, last thing I want to do is to struggle & be forced to return to the UK leaving a sour taste of my experience, whichever way I go I'll be in Calis in September for the winter!
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we're holidaying in september and maybe trying our 1 year trial from feb 2012.