Buying
Property in Turkey (FAQ's)
- Can I buy property in Turkey ?
- Where can I buy property ?
- Do I need a lawyer/solicitor
?
- Do I have to be there to buy a property
?
- How easy is it to buy land
?
- Are there any restrictions on the size of property
I can purchase ?
- How do I pay for the purchase of property ?
- What extra payments will I be required to pay in
addition to the purchase price ?
- What ongoing costs can I expect to pay ?
- Can I rent out my property ?
- If I sell my property can I take the money out of
Turkey ?
- Do I get title deeds for any property I purchase ?
- Are all services i.e. water, gas, electricity,
phone lines connected ?
- Can I bring my household effects into Turkey ?
Buying property in Turkey is relatively straightforward, recent legislation
(Dec 2005) permits foreign nationals to purchase property in Turkey and is based
on reciprocity, in other words where there is an agreement between Turkey and
the country of the purchaser. Most property in Turkey is sold on a
freehold basis and a new title deed 'Tapu' is issued upon purchase.
Foreign nationals can purchase property or land provided that it is not in
restricted or prohibited areas i.e. strategically important, protected
habitats or areas that possess religious or cultural significance, military
zones, special security areas or other prohibited areas.
Whilst it is not necessary or mandatory to use a lawyer/solicitor if you feel
more comfortable doing so you should use a good local English speaking lawyer
who will ensure all the procedures are carried out correctly and act in your
best interests.
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Obviously it is better for you to be here as you will know what is happening
first hand, but if this is not possible then power of attorney can be given to a
trusted person to act and sign any documents on your behalf. Homes
Unlimited can hold power of attorney for you.
Purchasing land is also quite straightforward, however you should ensure that
you have the necessary finances already in place as land is purchased outright
with the total purchase price normally being paid on signing any contract.
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Yes there are restrictions on size of land/property you can purchase.
Recent legislation restricts the size of land/property that foreign nationals
can buy to 2.5 hectares (25,000 sq meters) but can be increased to 30 hectares
by Cabinet decree. There is also a restriction in any one area for the
total amount of property that foreigners together can own.
Foreign foundations, associations, co-operatives, communities and groups are
not allowed to purchase real estate in Turkey.
If you are visiting with the intention to purchase it would be advisable to
have a deposit readily available which is normally 10-20% of the purchase price.
The balance of payment would normally be paid at the time of completing the
sale.
Usually payment terms are included in any sales contract.
In the case of buildings under construction stage payments would be normal,
however all prices are negotiable and you may find by paying 'up front' off plan
that you could obtain a substantial discount.
You should also check what type of deed/contract
you are being offered and what guarantees are being
offered.
It would also be advisable to open a bank account in Turkey for the transfer
of funds.
In addition to the purchase price of any property the following must be taken
into account and you should ask for an estimate of costs in relation to any
particular property. Roughly these additional costs are up to 10% of the
purchase price paid.
Additional Costs
1) Legal & other fees - these would vary depending on the amount of
work carried out by the lawyer, obtain an estimate from your lawyer to include
such things as investigations of title deed, translations, map fees, notary
fees, registration of title deed transfer, transfer of utilities etc.
2) Purchase tax - a purchase tax is levied by the government on registration
of the title deed transfer, This is currently 3% of the registered value
of the property. You should check with you lawyer for any changes to the
rates levied.
3) Mandatory insurance (DASK) - It is mandatory to take out 'earthquake'
insurance cover which will be based on the value of the property.
4) Agents fees - normally when buying through an estate agent you can
expect to pay up to 3% of the purchase price in agents commissions.
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You can expect to pay the following ongoing costs.
1) Property tax - Normally paid twice yearly similar to UK rates and is based
on a fixed percentage of the declared value. Do not expect an account to
be sent, it is up to you to find out when this is due and ensure payment is made
to the local council. After receiving your title deeds you should visit your
local council offices and register the ownership of your property. You are
responsible for the tax liability from the tax year after purchase, in other
words if you purchase property say in the tax year of 2006 you would be liable
for property tax from 2007
2) Building & contents insurance - In addition to the mandatory earthquake
insurance you should consider comprehensive cover for buildings and contents, of
course premiums will depend upon value and risks covered.
3) Electricity (Tedas) - Normally there are three tariffs charged based on
the time of day, the cheapest being during the night. Meters are read on a
two monthly basis but expect some leeway in meter readings. The
electricity bill is usually left at the property at the time of reading.
You will find on the bill the dates between which the account can be paid either
by payment over the counter at most banks or direct to the electricity company.
Direct debit arrangements can be made for the payment of electricity bills
through most banks providing of course you have an account in credit with them.
Failure to pay the bill by the latest date will result in a late payment fine
being levied on your account.
4) Water - Normally supplied by the local council and is metered and payment
is made to the local council office every two months.
If you are not connected to the local council
water supply water is normally tankered and payment
is made direct to the supplier on delivery.
Yes of course you can rent out any property you own. Your should
however be sure to check your tax liabilities with a suitably qualified
accountant or tax advisor as failure to do so may result in fines.
Any rental income will be liable for tax assessment either in your home
country or Turkey, your own personal tax situation will determine what is
payable.
Yes you can sell your property and take the proceeds out of the country.
You may however be liable for capital gains tax and you should seek advice from
a suitably qualified accountant or tax advisor.
If you place your property for sale by an estate agent you will of course be
liable to pay their commission fees, you should ask what these are at the time
of placing your property with them and of any other selling costs i.e. sales
tax, local documentation and any legal fees.
Provided you have purchased a property within permitted areas the
sale/purchase is recorded by an official of the Property Registration
Department. It is a legal requirement for both parties seller and buyer
(or their legal representative with power of attorney) to be present when the
entry is made.
After the entry is made in the register a title deed (Tapu) is issued.
This rather depends on where you have purchased property. In most towns
electricity and water is connected and metered. In villages and in more
rural areas council water may not be connected and you may have to rely upon
either your own well water or tankered water.
Natural gas is only available in the main cities, outside of these areas
bottled gas (LPG) is the norm and is supplied in various sizes. It is also
available via tanker delivered to a suitably installed holding tank.
You can bring your household effects to Turkey if you are taking up
residency. You must obtain your residency permit before shipping as
failure to do this may result in difficulties being experienced with customs
clearance.
In many cases the cost of transportation and insurance v cost of goods in
Turkey will not make this worthwhile. International movers can deal with
the whole process including clearing customs in Turkey if they are given power
of attorney to handle the process on your behalf.
NB YOU MUST MAKE SURE YOU HAVE ALL THE RELEVANT PAPERWORK TO HAND BEFORE
SHIPPING, FAILURE TO DO THIS MAY BE VERY EXPENSIVE!
Contact the Turkish Consulate in London for up to date information regarding
the requirements for residency and importing household effects.
(see links page)
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