Altinkum Property - It's Time To Start Living The Life You've Imagined

This quotation, attributed to the American author, Henry James, captures perfectly the mood among property buyers in Altinkum, Turkey. James would have been intrigued by the excitement rushing through this Aegean resort - an excitement that started in 2002 with the change in laws allowing foreign nationals to own property in Turkey in their own names, and now fuelled by intense interest from the British media and the experiences of early investors.

Until a few years ago, Altinkum was purely a holiday town. An arc of golden sand running gently down into a turquoise sea, so perfectly clear that in the shallows, the fish skimming around a bather's feet appear to be swimming in glass. A beachfront lined with small bars selling typical Turkish food and international favourites, a small central square with stalls of trinkets for souvenir hunters, and one nightclub summed up the total of Altinkum's tourist facilities.

Now property is the main industry of Altinkum, and the once minor resort in Turkey has become an investor's dream. Specialist magazines like A Place In The Sun and Homes Overseas have featured articles on the Altinkum gold rush, and the property boom has even caught the attention of the national press and television stations with news stories and TV programmes hailing Turkey as the next Spain and Altinkum as the new Marbella.

The Altinkum locals have responded in kind, ploughing billions of lira into regenerating the area. The main highway into the resort is now a tree-lined boulevard, with flower beds lining the pavements. Along the main beach runs a paved promenade studded with palm trees, and a marina and golf course will complete the transition from dusty town to cosmopolitan resort.

The local investment is seeing a major return. Apartments and villas are realising a year-on-year increase of as much as 30 percent, and two bedroom apartments which were available in 2000 for £6,000 are now asking upwards of £25,000. The area has seen its first sale of a single property over £200,000, and while this is still remarkably cheap to European eyes, it marks a major achievement for Altinkum, posting its entrance into the same league as Bodrum and Fethiye, which have been established property hotspots for many years.

Altinkum’s future is assured. The once-seasonal holiday town, deserted in winter by all but a few, now has a wealth of full-time expat residents. The more confident restaurateurs are staying too, providing excellent food and a place to meet throughout the winter. The biggest hotel in Altinkum held its first New Year’s Eve party this year, and next year promises a yet larger crowd to please as more and more buyers take the plunge and choose Turkey for Christmas.

Investment News – A-Day Reform to UK Pensions Allows Investment in Residential Property, & Good News for Business Owners & Expats

New legislation being brought in on 6th April that revolutionises what can be done with your pension. No longer will you be restricted to buying an annuity - Sam Dunn asks if new incentives to encourage us to save more will head off Britain's looming pension crisis

Any light that pierces the gloom enveloping the distant horizon of our pension provision is desperately needed.…But soon we should be able to see more clearly. The first shaft of light should penetrate the clouds in the autumn when Adair Turner, chairman of the Pensions Commission, reports back with recommendations likely to include higher taxes, a later retirement age or more generous savings incentives.

The second is A-Day, 6 April 2006 - the date of a radical revamp of pension rules…From 6 April next year, … savers opting for a self-invested personal pension (Sipp) will be able to use it to invest in residential property - whether a buy-to-let, a holiday home or even their own house.
In the latter case, details have yet to be finalised, but Tom McPhail, pensions specialist at independent financial adviser Hargreaves Lansdown, says it might work like this.

An individual with a sizeable pension pot (say, £400,000), but who plans to work for another 10 years, cashes it in to buy a house. He then pays rent to live there and the money feeds back into his very own Sipp scheme, increasing the value of it tax-free for as long as he's resident. When he's ready to retire, the property can be sold for cash that in turn buys a smaller home and an annuity.… It is anticipated that properties inside the fund will be free of tax on rental income and capital gains and would also be immune from inheritance tax after 75 as they remain part of the pension fund, making this a very appealing option indeed.

Additionally the amount available to borrow to purchase for this purpose will be up to 50% of the fund.

John Howell, senior partner at solicitors John Howell and Co, cautioned: "If SIPPs investment is done properly then it has great potential. The tax breaks are fantastic and it is a huge opportunity to use existing funds to buy residential and overseas property.”

Additional changes in the legislation mean that anyone will be able to make contributions to a UK pension scheme, regardless of where or for how long they are resident. This means that UK expats will be able to continue to contribute to their UK pensions.

Company directors and business owners can also benefit from the changes. Under current rules business owners who have not used up their pension allowance in previous tax years can make extra contributions to an executive pension plan (EPP).

Suppose you started a company in 1986, but haven’t made any contributions. By setting up an EPP now you can claim years of service right back to 1986. This entitles you to generous levels of tax-free cash, provided the contributions are made before A-Day.

Current rules allow the whole value of an EPP to be paid tax-free as long as the value of the fund is less than three-tenths of final pay, multiplied by the number of years worked.

So if you have 20 years of service and earn £100,000 in the year before retirement, you can take £75,000 tax-free.

Adrian Boulding of Legal & General, said: “Provided this amount of contribution has been made to an EPP before A-Day, the tax-free cash entitlement can be preserved under the new regime.
“For many business owners this is too good an opportunity to pass up.”

Sources:
A-Day Reform to UK Pensions Allows Investment in Residential Property: The Independent Online Edition, 1st May 2005; www.taxationweb.co.uk; www.myfinances.co.uk; Get Ready For Pensions A-Day: Times Online, 22nd May 2005

Altinkum Real Estate Agency Certification

Didim Chamber of Commerce has voted to introduce new legislation as a reaction to the massive numbers of new estate agencies that have followed property-hunters to Altinkum in droves. Concern has been raised about the need for some kind of control over the agents, many of whom have no formal training, experience or qualifications in the industry.

This new legislation requires all agencies to have a license to trade as estate agents, and to complete a certification course which covers public relations, deeds procedure, marketing and basic laws.

The Certification programme started on Monday 23rd May 2005 and 120 of Altinkum’s estimated 600 agencies attended. All agencies who do not complete the programme and qualify will be required to cease trading.

This new legislation is extremely good news for prospective property buyers who benefit from the reassurance of knowing they are dealing with a licensed member of Didim Chamber of Commerce.