The world is still reeling from the effects of the financial crisis, one of which was to completely collapse sales of Cape Verde property to foreign buyers. The Tortuga Beach and Spa resort launched to off plan buyers in 2007 but it might as well have not bothered. When thousands of people lost their shirts on Dubai property, everyone became extra cautious about off plan property, very few would risk it, and with very few buyers overall this meant no one.

But now Cape Verde is experiencing what can only be called a surge, or at least a flurry of overseas demand, with most of the buyers coming from Britain and snapping up off plan properties. What’s changed?

Well, it is partly to do with the fact that confidence is generally returning to global economies, partly to do with the fact that the UK economic recovery is solidifying, but it is mostly because of a growing desire for Brits to invest in their own pension funds, and the fact that Cape Verde property is an investment that is both safe and capable of bringing good returns.

For years the British middle class hadn’t to worry about their pension, we all lived under the security of the state pension for all. But as people continue to live longer and longer and with no reduction in the percentage of people wanting to live work-free, for the first time in the modern British era the state pension for all is falling into jeopardy.

So more and more of us have sought to invest in pensions. Before the financial crisis we were quite happy just to sheepishly put our money into high street pensions. But we all know what happened there, the stock market crashing took all our pensions with it.

So, there we were left with a need to invest in our own pensions, and knowing that high street fund managers might not be the best people to help us in this respect. For once, the government response to this quandary actually helped. The Self Invested Personal Pension allows us to invest in stocks and shares from internationally recognised exchanges, gilts, bonds and commercial property.

SIPPs combined with the growing desire among Brits to build their own pension funds are certainly a main reason for the increasing sales of Cape Verde property. But this is only because Cape Verde has become known as one of the world’s investment safe havens.

SIPP investors invest in property because they want a safe, long term investment, although they are usually looking for moderate-good rental returns as well. Cape Verde property is a good long term bet, because of its growing popularity and lack of building space.

Cape Verde offers the attributes of the Caribbean, within a short-haul flight of Europe and Britain. Because of this, although it did suffer at the hands of the financial crisis, tourism to Cape Verde grew strongly before the crunch and is set to grow even faster as the world recovers. Cape Verde property is also comparatively cheap compared to that of the Caribbean.

Undoubtedly the Cape Verdean developers have helped themselves. You have the three phases of Resort Group’s Melia Franchise which have sold rapidly in the last 18 months, and almost entirely to British SIPP investors, because the packages were geared to be the perfect SIPP investments.

Only resort and hotel properties are allowable as part of a SIPP, because the properties are part of a commercial entity in the resort. SIPP property investors are told to look for resorts with brands capable of achieving good occupancy, and where the rentals are pooled between owners.

Sol Melia has a turnover in excess of €1 billion, 2 million registered customers and 4.5 million hits per month on their online network, and on all three phases the rentals were to be pooled between owners of similar units.

Tortuga Beach Resort and spa offered a 10% rental guarantee in year one and continued rental management as part of the resort, the 1400 unit Dunas Beach Resort offers 15 years rental management with 50% of the NET rental income being distributed and shared by pools of similar sized units, and Llana Beach offers investments in 5 star hotel suites. Together, and sharing facilities makes this an incredible resort on Sal Island.

The bookings are already flowing, and with the aforementioned shortage of space to build on these rugged beach-fringed islands of Cape Verde, it is easy to see why SIPP investors are boosting sales of Cape Verde property.

SIPP investors can invest in the following as part of a SIPP, UK Equities (including Investment Trusts AIM Shares & ETFs,) Gilts, Bonds, regulated Unit Trusts, & OEICs, Shares in recognised overseas Stock Markets (NYSE, NASDAQ, CAC to name but a few), and Commercial Property.

You will see no holiday homes or residential property on that list, yet most of us have heard about the huge successes of overseas property in Cape Verde, Turkey and the Cayman Islands, which have sold out almost completely to SIPP investors in recent years.

What you will see if you look into these properties is that they are resort properties or hotel room investments aka apart-hotels, being sold to investors but under the rental management of a commercial resort. This type of investment opportunity is not only allowable under a SIPP, but they are mostly perfect for SIPP investment.

Obviously SIPP investors are looking to make the biggest returns possible for their old age, but they are also keen not to be left with less than they put in or close to nothing as well. Thus, most will have some exposure to the high-risk high-reward game of stocks and shares, but have a bigger exposure to the relative safety of property, which usually always appreciates in value over the long term, and when researched properly has a sound exit strategy.

So SIPP investors want a safe investment, with safe but good returns and a reliable exit strategy. Resort and hotel property deals almost always fit this profile.

Resort/hotel properties come under the management of a professional hotel or resort brand (investors should look for brands that are well established and capable of letting the number of units being built all year round), this means that they are a serviced hands-free investment perfect for a SIPP fund. But even better is that the professional rental management makes good yields very likely from rental income, and also a good chance of capital appreciation.

In fact, many such properties will guarantee the rental yield, and/or guarantee to buy to unit back after a given period for a given profit. An example of a perfect deal for a SIPP property investment is a 5 year guaranteed rental yield of maybe 5-6 percent, and a guaranteed buy back of 125% after the five years. What would make that even better would be for the buy-back to be optional, and for the investor to be able to try and sell for more on the open market before deciding.

One example of a near perfect SIPP allowed property investment is the land plots for sale in Cayman Islands under the Dolphin Estates brand on Brac. The developer guarantees a 20% return on investment over 4 years. This can either be taken annually as a rental guarantee, or at the end of the term as a buy back at 120% of the asking price, or last but not least sell the plot on the open market after 4 years, and still take the 20% from the developer allowing you to make an even bigger return.

Another is the Melia resort properties in Cape Verde. Cape Verde is protected from overdevelopment by the government, and because there is very little land suitable to build on. This will ensure that Cape Verde properties hold their value, and with the Melia brand managing rentals this means a good overall return on investment is all but guaranteed on these deals.

There are dozens of mainstream tourism and property hotspots including Bodrum, and dozens more off the beaten track. Belek and Alanya are sort of in between that, mainstream popularity but still, better known by select groups and more discerning travellers. Here are three Turkey property greats…

Belek

Belek is the golfing capital of Turkey, and since 2009 has become known as the next Algarve (references may have been made before this but it caught on in 2009). Home to eleven of Turkey’s 18 golf courses, Belek is a small town by international standards, but its growing golf industry mean it is home to some of the finest hotels, restaurants, bars and shops in all of Turkey. Brits feel at home in Belek.

Until recently there was no freehold property in Belek, but recent law changes have seen a couple of freehold opportunities springing up. Because of this demand for privately let properties is already outstripping capacity, especially of really good units. Of course the best thing about Belek is the fact that most people are primarily buying a holiday home, with rentals as a secondary consideration, when buying like this you can’t lose in Belek.

Bodrum

Bodrum property is definitely not middle of anything. Bodrum is one of the hottest tourist destinations in Turkey. According to aviation data collection site Anna.Aero (possibly the largest repository of aviation data in the world) traffic through Bodrum international airport grew 11% in 2010 compared to 2009. According to the website’s data for 2011, traffic through Bodrum international is growing at 13% year on year, based on the average of monthly figures for the first half of the year — the biggest growth was 28.8% in April.

We all know that rising tourism is boon for a property market like Bodrum, because property buyers will look to make money from rentals to holiday makers, and more holiday makers means higher occupancy, and higher rental yields.

Further evidence of the success of destinations like Bodrum comes from Rightmove, the UK’s largest overseas property portal. According to the portal’s monthly overseas data, searches for property in Mugla province are among the fastest growing in the world, to be precise it was the 7th fastest growing top trending region in June.

Alanya

Alanya property is less known about in the mainstream than the likes of Antalya, Istanbul or even Belek, but those in the know, know that it is one of Turkey’s top spots. In the summer millions of people come from all over the world to enjoy the food, culture, atmosphere, not to mention the sun, sea and sand. It is also home to Turkey’s largest population of British expats.

Alanya’s one failing until recently was its lack of an airport, which is arguably the reason why it never reached mainstream popularity. Expats needn’t care about the 90 minute journey to and from Antalya airport, and Alanya attracts primarily those who plan to holiday for at least 2 weeks.

Now though, that is all set to change as the long-awaited Gazipasa airport welcomed its first international flight several months ago. The airport is a long way from being as well serviced as Antalya, but when runway expansion works are complete airport operators expect its coverage to widen rapidly. This is expected to trigger a new property boom in the city and surrounding areas.

Turkey is now the fastest growing economy in the world, and has been in the top 5 fastest growing for over a year now. According to the Association of Real Estate Investment Companies (GYODER), foreign purchases increased by 40% last year. But of course, you can’t buy a property in Turkey; you have to buy on a street, in a town or city, within a region. Here are 3 of the hottest cities right now to aide in the initial choice.

1: Istanbul

Number one has to be Istanbul. The population of Istanbul is one of the fastest growing in the world, with estimations that it will rise from the current 12.7 million to 15 million by 2023. According to the same estimates Istanbul will need 250,000 of the 500,000 homes needed in Istanbul by then.

But of course the population is also growing rapidly in affluence. Because of this combination, and the high liquidity in the banking sector, which is fuelling 25% per year mortgage growth, experts are reporting demand for quality units outstripping supply by a huge margin, and developers unable to keep up with soaring demand.

This perfect storm is making Istanbul property one of the hottest residential investments, not only in Turkey, but in the world as well. Lest we not forget that Istanbul is also a hugely popular and growing tourism destination as well.

2: Antalya

This is a strange one. We are talking about Istanbul’s residential investment potential because it is such a huge city with a rapidly growing population, and here we have Antalya, the third biggest city in Turkey and also with a rapidly growing population, yet Antalya is predominantly a holiday home investment destination. This speaks to undiscovered opportunities for residential property investment.

Antalya has the best of both worlds. It is a metropolis with a population growing rapidly in affluence and number, and there are undoubtedly residential investment opportunities. But it is also a coastal resort town where millions of people from around the world come to enjoy the sun, sea, sand and ambiance each year through its well served international airport.

There is the potential to pick up a property on the outskirts of the city centre, which would bring residential rentals, but could also be rented out to holiday makers if a void corresponds with holiday season.

Antalya property is surprisingly cheap given this all-rounder appeal, and this complete package is why it is my second hottest tip for residential investment in Turkey.

3: Izmir

Izmir is Turkey’s second largest city, and like those above it also has a rapidly growing population. This is a trend because people are moving into these main centres from areas across Turkey to find better opportunities for work. Izmir is a largely undiscovered opportunity; prices are far lower than that of Istanbul and the potential for strong yields and capital growth is just as strong.

This is a guest post by Aydin Cakir, director of Turkey property agent New Home in Turkey

Well, I will let you decided. As well as all that above, we now see that employment growth (unemployment now in single figures), and the growing affluence of the population, combined with high liquidity is fuelling a boom on domestic consumption, as well as fuelling demand for housing not only through necessity, but also through desire and aspiration to move up the property ladder.

According to the Turkish association of real estate investment companies, foreign purchases of Turkish property grew 40% in 2010 compared to 2009. I will go on record now to say that foreign sales of Turkish property will have grown by at least 20% when GYODER releases data for 2011.

We already know that there has been strong growth in tourism. We know that there has been a particularly strong growth in tourism from Arab countries fuelled by the Arab Spring, which caused concerns about Turkey’s rivals in the Islamic holiday arena, as well as Turkey’s visa-free deals signed with many Arab countries. We also know of a similar surge in Russian tourism fuelled by the visa-free deal, and that Russians are becoming the dominant grouping of foreign buyers in some of Turkey’s top markets. This knowledge is enough for me to make such a strong prediction about Turkish property investment in 2011.

Aydin first confirmed that Russians are becoming the dominant nationality of buyers in “most areas” of Turkey. He went on to say that Russians are now the biggest buyers of property in Alanya, Antalya, Marmaris and Fethiye.

In the article about Marmaris Hasan Ate?, head of the Union of Marmaris Real Estate Agencies said:

“We real estate agencies in Marmaris are feeling the impact of the European financial crisis more this year. So far, we have not sold a single property to a European client. Now they are selling their homes, some at lower prices [than they paid to buy them],” he said, explaining that the opposite is true of Russian buyers who are rapidly growing in numbers.

From this you would think that this trend would be a regional thing, maybe the province of Aydin, or the wider south western coast, but from the four locations given by Cakir we can see this trend in the three regions most popular with foreign buyers, Antalya, Mugla and Aydin.

Russia is a massive country, with a rapidly growing economy and Russian buyers have long been a growing force in the overseas property industry. According to a major survey by leading Russian property magazine International Residence at the Moscow International Investment Show, Turkey is now the third most popular choice among the $12 billion Russian overseas property market, after Bulgaria and Spain.

In terms of really hot emerging markets, Latin America has Columbia, Ecuador and Brazil, even Argentina is up there now. Asia has Vietnam, Indonesia, and Thailand and Malaysia are rapidly finding new legs, of course this is alongside the big ones, China and India and many others. Africa and the Middle East have Egypt, Tunisia, Morocco, South Africa, Qatar, and Iraq.

But while Europe has the likes of Czech Republic and Poland, none of them have the scintillating growth of wealth of fundamentals that Turkey offers.

In fact, for me Turkey is currently the number one for property investment in the world, even better than Brazil.

Brazil has the rapid economic growth, population growth and employment growth, but it is still struggling to get its act together with respect to mortgages. It also has a high crime rate in many of the investment hotspots, though this picture is improving. However, those with cash are making high profits on Brazilian property investments.

Speaking of high crime rates, it also leaves Columbia, Ecuador, Indonesia (which also high a high terrorism threat), Argentina, and South Africa lagging far behind Turkey. Of course many people will not be put off by crime, not least because it is pretty much an international problem, but you can’t help but miss the common denominator; low crime in Muslim countries, which of course leaves Turkey at another advantage because it is one of the few Muslim countries not to see violence as part of the Arab spring.

This is what I mean about the wealth of fundamentals, when you look at Turkey it just has everything going for it. On top of the core package of sun, sea and sand, it also has ski-resorts, now it has rapid economic growth, economic and political stability, growing employment, growing affluence, which means growing demand for rental accommodation, and growing mortgage market which means growing local property purchases, and of course a low crime rate.

Of course, while Turkey has its problems with corruption and press freedoms, there aren’t many mentioned above that don’t. Turkey also has terrorism from the Kurdish Workers Party PKK but this is mostly confined to the north near the border with Iraq.

Aydin Cakir of Turkey property agent New Home in Turkey, put it well, he said:

"Even when you look at Turkey’s problems with corruption and media freedom, they are problems for us Turks that affect foreign investment in no other way than a wrangle with morality, which isn’t a factor for most investors. The Turkish government is stable and friendly to investors, and investment is growing."

Cakir is right about the last part, according to the latest data from the Central Bank of the Republic of Turkey (CBRT), foreign investment increased 324% in the first half of this year compared to last year.

Turkey has not only bridged the political divide between secular democracy and Islamic Autocracy, but it has also bridged the gap between west and east; Turkey’s good relations with the west does not put off those in the east, and Turkey has successfully increased ties with both sides of the divide in the last 18 months.

At a time when this divide has never been more important, Turkey would seem to be an invaluable partner for the EU and the western world. Meanwhile the benefits to Turkey are tried and tested, with a major boost to the economy, tourism sector and property market. Unfortunately its accession seems as far away as ever.

Germany and France remain the poster boys for the campaign to keep Turkey out of the EU, but there are others who don’t feel Turkey is ready yet. Meanwhile liberals in Turkey insist that the reforms must be continued for the good of Turkey. The EU continually pushes a privileged partnership across the table at Turkey in the hopes that they will eventually be fed up enough to accept it. Turkey is absolutely against anything that isn’t full accession.

Who will give in first? The answer is neither. The EU won’t be able to accept Turkey until a resolution with EU member Cyprus is found, and Turkey will never accept a privileged partnership because this would be to accept being treated differently to the rest of Europe, and because it really has no need to.

In the past 18 months Turkey has signed deals with most countries in the world to either increase trade, scrap visas and or create free trade zones. These include visa-free deals with Russia, Portugal, Libya, Lebanon, Tunisia, Syria and Morocco.

On the balancing scale, right now it does seem that the EU does need Turkey more than the opposite is true. One of the biggest concerns for European governments today is preventing terrorism and forming closer ties with Muslim’s. Turkey could be of vital assistance in this struggle, not to mention the economic boost it would provide.

Thanks to Aydin Cakir of Turkey property agent New Home in Turkey for assistance with this article.

A lot more people are likely to choose to buy property here that will provide holiday accommodation for themselves and which can be rented out for much of the season.

Choosing a buy to let property in Turkey, or a holiday investment property is quite different from choosing property just for your own use. There are a number of things that need to be taken into consideration such as location, and the number of people that a property can sleep.

Any property that is being bought for rental purposes has to make enough money to cover mortgage and maintenance costs and is probably expected to appreciate in value especially in the long term.

The location is probably the most important thing, as it needs to be relatively close to an airport with good connections to the rest of Europe. It should also have good amenities such as shops and restaurants, and it’s advantageous to be near attractions. It’s best to check that the shops and restaurants stay open all year round as some towns still have seasonal opening only.

One of the top choices for Britons is the resort of Fethiye. It’s just a 20 minutes drive from Dalaman and beautiful government protected Olu Deniz. The international airport at Dalaman has numerous budget flights from the UK. Fethiye has hot dry summers and short, warm, rainy winters, and summer temperatures average between 30°C and 40°C, while temperatures in the winter are usually above 10°C.

The season here remains warm all year round as temperatures never drop below 16°C. Buying an investment property in Fethiye is likely to give annual rental yields of between 6% and 8%.

Another place with a look is Altinkum which is a rapidly developing resort where property prices are still much lower than the rest of Turkey. This resort has the advantage of having the largest marina on the Aegean which opened just a couple of years ago.

The marina has a lot of shops and restaurants, a multiscreen cinema and over 1000 moorings. Rental yields are currently between 5% and 6% but are expected to rise, while the low property prices should enable greater capital appreciation.

Turkey has already taken steps to tackle this deficit with the central bank embarking upon what many feel is an unorthodox strategy designed to devalue the lira and the amount of loans being made, and to deter speculators who could destabilise the economy if they chose to remove their money at short notice. The bank introduced interest rate cuts and higher required reserve ratios last December in order to make the country less attractive to speculators.

The governor of the central bank Durmus Yilmaz has already announced that this policy is beginning to work and that $10 billion of short-term money had already been removed from the country, and that consumer consumption was beginning to slow, but that the risk of inflation remains due to rising oil prices.

The governor is still confident that inflation will not exceed their forecast of 5.9% for 2011. The governors said that they expected the current account deficit to widen during the first quarter before the balancing effects of the central bank measures become more visible during the second quarter. The country managed to repay $992.1 million of foreign debt during February, and it repaid a total of US$13.32 billion in foreign debt during 2010.

"Turkey’s account deficit is the one weak spot in this booming country, and the fact that this has been recognised and measures put in place to deal with it should reassure anyone looking to invest here," said Aydin Cakir, director of New Home in Turkey, an agency currently marketing property in Turkey from 25,000 EUR.

Turkey has also gone out of its way to strengthen trade ties with other countries and has worked hard to get trade agreements with them in place. Increasing its exports will reduce this deficit. It already exports a large number of cars and this is expected to increase substantially, with 1.1 million units expected to be exported this year which would represent a complete recovery from the fall in production in 2009.

The world economy stands to be affected if oil prices continue to stay high but most analysts believe this to be a temporary price rise. Saudi Arabia who is the world’s top exporter of oil has already raised output to calm any fears about disruptions to supplies due to the turmoil in Libya.

Thanks to Turkey property agent New Home in Turkey for assistance in this article.