HOW TO BUY A PROPERTY IN TURKEY?
Buying a property as a non-national is a relatively straightforward process, despite the necessity for the military to approve all foreign purchasers. In practice, however, the military sign-off is a formality – it is only undertaken to ensure that the land on which the property you are buying stands does not fall within a restricted zone. The procedure takes three to six months and will be undertaken on your behalf by a solicitor appointed by you. A draft agreement will then be prepared by the seller’s agent for approval by your solicitor. You will need to pay a deposit, plus legal fees, taxes and agent’s commission. You should budget on six to seven per cent of the purchase price for fees. Stamp duty is 3 %, split between the buyer and the seller.
Once the paperwork has been prepared, the buyer (or a solicitor on the buyer’s behalf), seller and estate agent will sign the legal papers. At which point, the deed is registered in your name. Generally speaking the entire process takes between 6 to 8 weeks.
BUYING PROCESS - STEPS
- Once a property has been selected and a price agreed, a preliminary agreement may be signed by both parties, which may require a deposit. Full checks are then carried out on the property and its title deeds (TAPU).
- The buyer should register with the local tax office and open a bank account. The buyer must also supply the TAPU office with proof of ID and a copy of the current TAPU.
- The TAPU office then makes an application for purchase on your behalf – this includes a check of the buyer’s suitability and verification that the property is not in a military area.
- Once clearance has been given, the two parties sign a final contract, the balance is paid, and formal title deeds are given to the buyer.
- The buyer must then inform the local municipality of the transfer.
- Taxes and fees include a stamp duty tax levied at 1.5 %, land registration fees, and fees to the notary, the municipality, lawyers and translators.
- Due to frequent confusion over title, the services of a competent lawyer are considered indispensable when buying in Turkey.
BUYING FACTS
• Foreigners cannot buy property in Turkey unless they have gained military clearance from the Ministry of Defence. Not all foreigners can buy property in Turkey. You have to check whether your country allows Turkish nationals to acquire land. Foreign companies can only acquire land under certain pieces of legislation.
• Once you have paid a reservation fee of 1% to 2%, the property will be taken off the market for a period of 20 days.
• Inspectors may take photos of new builds being constructed and post them for you to view on the Internet
• You can grant power of attorney to a solicitor to oversee the legal process while you are out of the country
• New properties are exempt from annual property taxes for the first five years. You don't have to pay capital gains tax after you have owned the property for five years.
TAXES AND FEES
Approximately 10 % of the value of the property to cover all costs. Agents fees are usually around 3% and legal fees vary depending on how straightforward the process is, but can be up to 5%. Stamp duty is normally 1.5 % and there are also local annual taxes of around 0.6 %. On top of this, there will also be land registration fees, notary fees and translation charges for all the official documents. It is also compulsory to take out earthquake insurance as soon as possible after completion.
WHAT ARE THE EXTRA COSTS OF BUYING PROPERTY IN TURKEY?
• Property price includes land
• 3% property purchase tax (1 payment to the local authority)
• € 100 (₤ 60) registration of title deed in your name (1 payment)
• € 100 (₤ 60) for Power of Attorney and contract translation at the Notary(1 payment)
• € 150 (₤ 90) registration of electric and water meters (1 payment)
• € 750 - € 1000 approx. (Ј 500 - Ј 700) property occupation tax (iskan) for brand new developments. Depending on the area of the property this tax.
LEGAL ISSUES
Since July 2003 the decades-old legislation regulating foreign ownership. Foreigners may purchase land and property in Turkey in their own name and, when the time comes to sell, the proceeds of the sale may be transferred out of Turkey. A lawyer/solicitor is not required in Turkey although it makes sense, for your own peace of mind, to consult one.
