Practical Land Valuation before investing in Land

Land valuation is key to making a good investment. In some cases, especially in Turkey, you may not have a consultant by your side. 

The Land

Let us say you are after buying a land plot however, you are unsure that the price is right. With this simple method, you could easily make a land valuation and find out whether you are buying the property at the right price. This way, you would have the chance to avoid the deal if the price is too high.

Taking round numbers is always best however, let us look at the price of a land in Mersin which is currently advertised by MARE Investment.

This land is for sale for 15.000.000 TL and you can see it on Sahibinden.com as well. 

Its area is 1.120 sqm

Its zoning is residential E=0,90 and allows 8 floors.

Calculations for land valuation

In Zoning Plans E represents the sellable area of a building and it is multiplied by the area of the plot, so let us do that.

1.120 sqm x 0,90 = 1.008,00 sqm – This is the net sellable area of your building. About 20% of open extensions such as a balcony is allowed to be added to the sellable area. So, let us add that to the total sellable area too.

1.008 sqm x 1,20 = 1.209,60 sqm – This is the total sellable area of your building, however in Turkey developers divide the total construction area to the number of units to find the gross area of an apartment. So, let us add the common areas like a lobby, elevator space, a staircase, shelter etc.

1.209,60 sqm x 1,25 = 1.512,00 sqm – This is our total construction area (1.450-1.600)

A one-bedroom unit is about 55 sqm gross, and this gives us 27 one-bedroom units in total.

One-bedroom units cost about 25.000 TL/sqm to build and this size of a building would take about max 12 months to finish. (05.05.2025)

So, total construction cost is 37.800.000 TL

Land + building cost in total is 52.800.000 TL

In this area of Mezitli, and in this building in particular we will be able to sell 1+1 units from 2.900.000 to 3.700.000 so let us say 3.400.000 TL on average.

Total revenue will be 91.800.000 TL

This leaves a gross profit of 39.000.000 TL which is 74% profit on the total amount spent.

Let us say you are targeting a minimum 70% profit. Then, according to this land valuation the price is right. We can make an offer to get it at the best price possible. 

If you would like to discuss land investment in Mersin, please feel free to call us. We can look at this option or others, depending on your plans.