September 6, 2013 7:39 pm

High demand raises prices for high-end homes in Turkey’s Cesme

The resort’s liberal views and status as a celebrity hang-out has seen it labelled the Turkish Saint-Tropez
The town of Cesme in Turkey©Robert Harding

The town of Cesme, where agents estimate prices for upmarket homes have risen by up to 10% in the past year

When Irishwoman Jane Deasy bought her detached new-build house on Turkey’s Cesme peninsula in 2008 she was attracted by the “traditional rural life” on the fringes of the resort. At that time the town was already vying with the more famous Bodrum – another Turkish resort located on a peninsula – for the title of the country’s most sophisticated second-home destination.

The profile of Cesme, with 22,000 permanent residents in the biggest settlement on the peninsula, rose with the opening of a 375-berth marina in 2010, built by British company Camper & Nicholsons.

Deasy’s home overlooks the 1.5km crescent of Ilica beach, close to the village of Alacati, which many regard as the epicentre of Cesme’s property boom. Here, many two-storey stone houses with walled gardens were abandoned by ethnic Greeks during the Greco-Turkish population exchange of 1923, and have now for the most part become carefully restored homes, high-end shops and boutique hotels.

“In Alacati, there is still a parking spot reserved for a tractor across from a designer boutique,” says Deasy, a translator, who credits her discovery of Cesme to a few exploratory trips looking for an “authentic Turkish resort”.

With the Turkish economy and its housing sector riding high, Cesme’s farmers might have to make way for the arrival of more builders. According to the Central Bank of the Republic of Turkey, house prices in the country rose by an average of more than 12 per cent in the 12-month period up to May this year, and the desire for second-home ownership among Turkey’s wealthy elite shows little sign of abating.

According to Heri Nadery, managing director of the Cesme office of Engel & Völkers, prices of upmarket property have risen by between 5 and 10 per cent in the Cesme peninsula over the past year, with price increases for building plots sometimes significantly higher. “After some big price rises the market appears quite stable now,” says Nadery, who is marketing a three-bedroom home with a swimming pool and sea views in the village of Ovacik, about 15 minutes’ drive from Cesme town. The property has 310 sq metres of living space including a home cinema, on a 3,500 sq metre plot, and is on sale for €1.8m.

Map of Cesme, Trukey

Meanwhile, a 62 sq metre, one-bedroom unit in a seafront complex on the outskirts of Cesme town is being offered by the Vartur estate agency for €165,000.

These are price tags that may come as a surprise to anyone who has not visited Turkey in the past decade, as might the six-lane motorway with its fully electronic toll system that connects Cesme with the city of Izmir 80km to the east.

In much of the peninsula, it seems that only the abundant bougainvillea and sweet Turkish pastries have remained a constant.

The presence in Cesme of a summer outpost of Istanbul’s Babylon nightclub, among other fashionable watering holes, has made the peninsula a hang-out for Turkish celebrities and paparazzi, earning it a reputation as Turkey’s equivalent of Saint-Tropez. The fact that there is a more liberal attitude to alcohol and dress in Izmir province compared with much of the rest of Turkey, has also contributed to the town’s party image.

But strict zoning regulations, and a standard two-storey cap on construction in Alacati in particular, have limited urban sprawl.

“As a result, many potential buyers say that the Cesme peninsula feels more exclusive than Bodrum,” says Nadery of Engel & Völkers.

The Port Alacati project is a good example of the strong demand for attractive housing. This 220-hectare scheme, centred on a system of navigable channels, was modelled on Port Grimaud on France’s Cote d’Azur.

Since 2005, the first phase of 250 homes has been built, and all except two of the properties have been sold. A three-bedroom apartment with 184 sq metres of living space and a 102 sq metre terrace is on the market for €900,000, while a one-bedroom unit with 73 sq metres of living space and a 10 sq metre terrace is offered for €260,000. Both homes have their own boat berth, car parking space and Poggenpohl-fitted designer kitchen. The larger unit is subject to the standard VAT rate of 18 per cent but the smaller one qualifies for a reduced VAT rate of 1 per cent.

Port Alacati in Turkey

Port Alacati, where a three-bed apartment is on the market for €900,000

Port Alacati is planning a new release of off-plan homes with gardens and private boat moorings by the end of the year, according to Ali Mutlu, director of operations, who says that prices are likely to start at “a little over €3,000” per sq metre.

Mutlu’s customer base is a who’s who of Turkish industry, which has the effect of making Port Alacati very quiet when the high season ends in mid-September and the owners return to work – chiefly to Istanbul, Ankara and Izmir. However, overseas buyers, including French, Germans and Italians, account for about 15 per cent of total sales at Port Alacati.

For the moment, though, Alacati Bay is buzzing with windsurfers and boat owners. “We attract people who are interested in sailing and the water and who want to be in an environment that isn’t congested,” says Mutlu. His ideas to extend Alacati’s short season include building a golf course on part of the estate, which should be completed in 2016.

“Given the wind and the slopes, it will be a course with quite a high handicap,” says Mutlu.

However, overseas buyers in Turkey have to have patience. Military permission (given as a matter of routine) is still needed before property titles can change hands – and this can take anything from several weeks to six months.

Although it is possible to buy property in Turkey with merely the use of a notary, the UK’s Foreign Office strongly recommends hiring the services of an independent lawyer before committing to a purchase to check on the title deeds.

Plots of land in rural areas can sometimes be owned collectively by as many as 100 people. Potential buyers should also check that there are no outstanding bills to be paid and that the deeds have not been offered as a collateral for any loans.

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Buying guide

● Earthquake insurance is mandatory for homeowners in Turkey

● Estate agents often charge buyers and sellers a 3 per cent commission

● A quarter of Turkey’s 75m people are under the age of 15

● Gross domestic product rose by 3 per cent in the first quarter of 2013

● House prices are often advertised in euros or dollars but payment must be made in Turkish lira

● Cesme’s nearest international airport is at Izmir, 80km away

What you can buy for . . . 

€100,000 A 70 sq metre, one-bedroom flat

€1m A 300 sq metre, new-build five-bedroom villa with pool and sea view

€5m A two-villa compound on a 1.2 hectare plot with 500 sq metres of living space, pool and Turkish sauna

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