There’s a place in the middle of Istanbul where you can sit at a window flung open onto the water and look across the sweep of the Bosphorus as it runs through the city’s heart. To your right is a parade of fine wooden houses with lace-like trellises, each with a private jetty. To your left is a small public square where locals drink tea on benches under a spreading linden tree. And behind you, up the narrow valley, is a neighbourhood that feels like a rare find amid the city’s overdeveloped sprawl.

Monocle is lunching at Ismet Baba, a meyhane – or fish restaurant – that has been operating from this spot in the centre of the Kuzguncuk district since 1951. A huge photo of its founder, Ismet Baba, watches over the regulars who gather here over tall, milky glasses of raki, Turkey’s national aniseed liqueur.

Kuzguncuk – which translates as “little raven” – lives up to the spirit of its fairy-tale name as a laidback haven for artists, architects and academics. This slice of old Istanbul on the Asian shore of the Bosphorus was once a quaint village, home mainly to Greek and Armenian Christians and Jews. In the late 19th and early 20th centuries, a parade of balconied wooden houses was built along its main street, Icadiye Caddesi, with a few stone buildings in baroque and art deco styles thrown in later. There are a couple of hammams and at its heart are the still thriving historic bostan, or allotments, popular in Ottoman Istanbul. Kuzguncuk emptied and became down at heel in the mid-20th century as most of the Christians and Jews left. But its dinky churches and synagogues survive, as have many historic buildings and public spaces. The result is a district that has retained the character of old Istanbul but with a stylish, independent-spirited new spin – though the threat of chain stores is never far away.

Every shop premises along Icadiye is a small art display, be it a huge, glass-fronted canteen showcasing its kavurma, pieces of roasted veal bubbling in butter, an ice-cream joint with a graphic installation in the window or a parfumerie selling scents mixed by hand in a nearby workshop. There is plenty to remind you that this is a living area too. The eczane, or chemist, which opened at its spot on Icadiye in 1905, serves customers amid its collection of vintage medicine bottles and old photos of the area. Venture into the rooms of the falci, a fortune teller giving readings from a crooked old building on the corner of Tufan Sokak, and you will find an interior preserved like a museum – a window onto the Kuzguncuk of old. On the pavements, sellers offer dried local lavender – the same that powers the parfumerie – from baskets.

Today’s Kuzguncuklular are custodians, says Refika Birgül, who has been living and working here – and renovating its old buildings – for 22 years. “Decay and regeneration are a cycle,” she says. “But the people who stay here ensure that it is never going in a bad direction.”

Birgül is the founder and star of Refika’s Kitchen, an online cooking channel that expanded into a cookery book and kitchenware line, all based in Kuzguncuk. The nerve centre of her business is a five-storey stone building dating from 1923; the year is written three times above the door in the Gregorian, Islamic and Hebrew calendars. It was a wreck when she bought it but, with her family and team, she restored its history and rich interior, stripping back the rooms to showcase high ceilings and show-stopping views from wide windows. On the top floor, the roomy studio kitchen opens onto a terrace where you can see all of Kuzguncuk before you. Stained-glass windows up the landing cast the building’s winding internal wooden stairs in bright colours. This is one of a clutch of buildings that Birgul, who also lives here, has renovated in Kuzguncuk.

“If you want the fancy, posh life, in new buildings with all the modern comforts, then Kuzguncuk is not for you,” she says. “But that is the beauty of it.” This spirit is in evidence at the bostan allotments at the top of Icadiye, lined by a row of grand coloured villas. Campaigning residents have ensured that they remain; today there are more than 100 patches divided by the municipality, which distributes its crops to schools, restaurants and residents. It’s also a wonderful place to wander on a sunny afternoon, full of dozing cats and wildflowers. The bostan is the very soul of Kuzguncuk, says Nazli Piskin, a historian and Mediterranean food expert who is based in the area. “It’s not just nostalgic,” she says. “This is a place to reconnect with the seeds, the plants and the animals, to touch the soil.”

These days it is rarer to find a restoration project here, and prices have soared. Expect to pay several million euros for a yali, one of the old wooden villas on the water that rarely come up for sale. Further from the strait, there is always a steady stream of sale and rentals available, in historic buildings and more ordinary modern apartments. Any foothold will give you a place in Kuzguncuk’s tight-knit community. This is one of the smallest Istanbul wards by population, so expect to see the same welcoming faces on morning strolls down to the Bosphorus.