The procedure for buying and registering property in Turkey

Despite the pandemic and the global economic crisis, Turkey is experiencing a real boom in the real estate industry. Apartments, houses and entire residential complexes are eagerly bought up by both local residents and foreign citizens.

How to buy property in Turkey

Foreign citizens can buy property in Turkey, if a number of conditions are met:

• The land plot area size cannot exceed 30 hectares.
• Russian and Ukrainian citizens cannot buy real estate on the Black Sea coast.
• The object cannot be located in the military or strategically important zone of Turkey. Zoning is carried out by the Turkish Ministry of Defence.

However, these conditions do not limit foreigners in their purchase: they mainly choose real estate on the coast of the Mediterranean and Aegean Seas, as well as in Istanbul and Ankara.

Legal aspects of buying Turkish property by foreign citizens

Since 2012, Turkey has abolished the “principle of reciprocity” and allowed the purchase of real estate by citizens of those countries in which there is no such opportunity for Turkish citizens.

Now citizens of 129 countries can become owners of land, apartments or villas, as well as commercial real estate located in Turkey.

Rights and obligations arising from the purchase of property in Turkey:

• The purchase of property is considered an investment in the Turkish economy. This is sufficient grounds for obtaining a residence permit. The property price must exceed 75,000 US dollars in 30 provinces of large municipalities and 50,000 US dollars in the remaining 51 provinces. At the same time, not any property can become the basis for obtaining a residence permit. In 2022, the Turkish authorities limited the issuance of new residence permits in 1,200 neighbourhoods across the country, where the proportion of foreigners in relation to citizens exceeded 20%. A complete list of those neighbourhoods can be found on the website of the Turkish Presidency of Migration Management.
• With a cadastral value of 400,000 US dollars, the owner has the right to obtain Turkish citizenship.
• Turkish real estate owners must pay the necessary taxes on time and do not forget about paying utility bills.
• The owner is obliged to comply with Turkish laws when staying in the country and conducting real estate transactions, such as renting.
• It is also necessary to comply with the laws of the country of origin: for example, notify the tax office about purchasing real estate in Turkey and opening an account in a Turkish bank.

How to find a suitable property in Turkey

After a thorough study of the Turkish real estate market, it is necessary to identify the basic requirements for the object.

They may be as follows:

• location of the object;
• state of the object;
• area size and number of rooms/floors;
• price.

Some companies organise property viewing tours.

What to check when choosing a real estate agent?

• certifications and professional licence;
• registration with the Chamber of Commerce and Industry, registration with the tax office;
• legal address and duration of work on the market.

Realtor services should include property inspection, registration and filing of documents.

Step 1: choosing an object and signing a contract

After choosing a suitable object, the seller and buyer agree on a meeting at which they conclude a sales contract.

The contract should contain the following data:

• information about the parties to the transaction;
• object’s specifications;
• terms of the transaction: time limits and payment method;
• amount of the deposit and sanctions in case of violation of conditions for both parties;
• rights and obligations of participants.

The buyer will need to provide an international passport. The contract must be executed in 2 copies in the languages of the buyer and the seller.

The contract comes into force only after registration with the Cadastral Office and the transfer of ownership.

When signing the contract, the buyer also makes a deposit for booking the object. Usually the deposit amount is from 1,000 to 10,000 US dollars.

Step 2: collecting and processing the documents

To conduct a sale and purchase transaction, it is necessary to collect and prepare the following documents:

• International passport.
• Power of attorney for an official representative of the buyer, for example, a realtor. It is issued by a notary.
• Turkish TIN. This document is necessary for the transaction, without a TIN it will not be possible to register real estate, open a bank account and renew contracts with utilities. To get a TIN, you need to come to the tax office (vergi dairesi) with your passport and submit an application.

Step 3: settling with the seller

Depending on the location of the purchased object, payment can be made in US dollars, euro, Turkish liras or British pounds.

There is no need to open a Turkish bank account for payment. It is made by international transfer from a foreigner's account in the bank of his country to the account of the seller or his official representative, for example, a real estate agency. The purpose of the payment is indicated in the transfer and supporting documents are attached: a sales contract, an invoice, if necessary, a power of attorney and a certificate of beneficiaries.

Full payment will be required to complete the transfer of ownership and obtain a TAPU — a document that indicates ownership.

Step 4: transferring ownership

All parties to the transaction must appear at the Cadastral Office to register the new owner. A certificate of ownership (TAPU) is the only document that is irrefutable proof of ownership of a property.

For plots without buildings, they issue a blue TAPU, for plots with an already built object — a red one.

Depending on the type, a TAPU indicates the following:

• property address;
• photo of the owner;
• information from the General Directorate of Land Registry and Cadastre about property registration;
• state of the object and its area size;
• property type;
• property value;
• information about previous and new owners;
• purchase and registration details of the previous owner;
• TAPU’s number in the cadastral register;
• date of purchase by the new owner.

A TAPU is certified by the seal of the Cadastral Office and the signature of its employee.

To apply for a TAPU, foreign citizens must provide an international passport valid for at least six months, 3 photographs 3x4 cm in size, a Turkish TIN, and a power of attorney if the owner cannot be present in person.

TAPU processing takes up to 5 working days.

Step 5: renewing utility contracts

After the transfer of ownership and receipt of a TAPU, it is necessary to renew utility contracts. To do this, you will need Ferdi Iskan — an individual registration certificate of the object. If a new building is purchased, then Iskan must be obtained from the developer. If the property is purchased on the secondary market, the seller usually already has Iskan.

To conclude or renew contracts with utility providers, the following documents are required:

• copy of an international passport;
• copy of a TAPU;
• copy of the object’s Iskan;
• compulsory insurance policy against natural disasters and earthquakes;
• utility meters numbers;
• notarised power of attorney if there is a proxy;
• application for connection to services.

How to conduct a real estate deal in Turkey remotely

In order to remotely buy property in Turkey, you need to contact the Turkish embassy or consulate in your country, so as to issue a power of attorney for a lawyer who will act on behalf of the buyer and obtain a TIN, conclude a sales contract, register the transaction in the cadastre, etc.

Related costs when purchasing Turkish property

Compared to many European countries, where purchase costs are 10% of the property value, in Turkey these costs do not exceed 5%.

What is included in the extra costs?

• Property transfer tax — 4% of the cadastral value. Depending on the agreements between the buyer and seller, this tax can be divided between them in different proportions.
• State duty for a TAPU and the services of a state interpreter during the deal — about 300 euro.
• Notarised power of attorney — 100–150 euro.
• Ferdi Iskan — a registration certificate for real estate, obtaining is necessary only for new buildings — 300–1,000 euro. In most cases, these costs are borne by the developer.
• DASK — a compulsory insurance against natural disasters and earthquakes — 15–150 euro.
• The seller pays the brokerage commission in Turkey.
• VAT from 1% to 18% (depending on the area of the object), if real estate is purchased from the developer. But according to Turkish laws, foreigners have the right to return this tax in full after registering the property.

Can a foreigner take out a mortgage in Turkey?

The issuance of mortgages in Turkey to foreigners has been suspended. Formally, this is due to the new rules that came into force in January 2022 due to amendments to Article 13 of the Turkish Capital Circular.

Now, in real estate deals, foreign buyers must exchange foreign currency for Turkish liras and receive a special exchange certificate — Döviz Alım Belgesi. A foreigner can register ownership of the property only with such a certificate (a complete guide from the Cadastral Administration). The amount of the convertible currency must match the sale price indicated in the title deed (TAPU). When receiving a housing loan, part of the real estate cost is paid by the bank, and the new owner pays only the down payment.

Author: Tranio Editorial