Real estate law in Turkey
We have attempted in our article to briefly explain the real estate law in Turkey, and in particular, practical aspects of buying and selling property as well as key points for foreigners. Of course, it is not always possible to cover the entire topic in one article. However, if you do not understand something or have a question, you can fill out the form on our page and contact us. We hope that our article is useful to you.
Property Purchase and Property Sale
In Turkey, the final property purchase takes place at the Land Registry Office (Tapu Müdürlüğü). The buyer and seller either submit the required application along with the necessary documents at the relevant Land Registry Office together or through their representative.
The parties can only conclude a preliminary sales agreement before a Turkish notary. The risk is that the seller can still sell the same property to a third party despite this notarial contract, unless the preliminary sales agreement is registered in the Land Registry. In that case, the buyer has the option to claim the transfer of the property from the third party. This registration is valid for five years.
Agency contracts or written property sales contracts are generally not valid for land purchase.
I.e., After the payment of the purchase price, the buyer cannot sue for the registration of their rights in the Land Registry if the seller is not willing to proceed with the registration.
However, the contract can be examined for incidental matters.
Land Registry check with regard to encumbrances, restrictions, and existing registrations (sale prohibition by foreigners etc.)
What are the required documents for the purchase or sale of property for the land registry registration?”
- ID or passport (with notarial and certified translation) of the parties or their
- representatives – Foreigners must also present their tax number
- Earthquake insurance
- Land Registry information sheet for foreign buyers and/or sellers
- Accompaniment of a translator for the Turkish language
- Land registry extract or the information about the property
- Certified appraisal report for foreign buyers and/or sellers
- The official appraisal report from the city administration
Mandatory appraisal by foreigners
Mandatory appraisal by foreigners as of March 4, 2019
According to the Land Registry Regulation 2019/1, foreign buyers and sellers must have the property evaluated by an accredited appraisal company (These companies are officially known on the website: www.bddk.org.tr). This appraisal, along with the necessary documents, is then submitted to the Land Registry Office. This has a validity period of three months.
How should the property price be paid when purchasing real estate?
Payment of Purchase Price in Turkey
When buying or selling real estate in Turkey, the purchase price is usually paid in cash at the Land Registry Office, shortly before signing the notarized purchase contract, and usually at the Land Registry Office. The buyer also has the option to pay the purchase price through a blocked check. After the transaction at the Land Registry Office, the seller can withdraw the purchase price. The seller should have the check checked beforehand.
There is a new system in Turkey for payment of the purchase price: Land Registry Exchange System (See: www.taputakas.com.tr). The system is very similar to real estate purchase in Germany through the notary. The parties register with a certain public bank, so-called “Takasbank,” and enter all necessary payment transaction information into the system.
This system protects the parties of the purchase contract from forgeries and theft of money. The parties can inquire whether the purchase price has been sent to Takasbank and blocked in a special account. If the seller sees that the money is blocked, the document can be safely signed at the Land Registry Office. This is because the purchase price is automatically transferred to the seller’s account after signing. In this way, the issue of trust towards the buyer is eliminated. The parties receive a text message (SMS) about the respective steps of the procedure at the Land Registry Office.
The use of this system has a low cost of 70 TL (for the year 2023). Even if the transaction is canceled by the parties, these costs are incurred. The remaining amount will then be refunded to the buyer’s account.
Transfer of Ownership in Turkey
After the notarization of the real estate purchase contract at the Land Registry Office, the property is transferred to the buyers. The parties mutually accept at the time of signing the contract at the Land Registry Office in Turkey that the buyer has paid the entire purchase price and the seller has received the entire purchase price.
Within three months of acquiring a property, the buyer must register as the new owner with the relevant municipality for the payment of property tax.
Transfer of Ownership in Turkey
This is what a Turkish Land Registry extract looks like in Turkey. Status: 2023
What are the additional purchase costs and agent fees in Turkey?
The property acquisition tax is 4% of the stated purchase price. The buyer and the seller pay this fee in equal parts unless otherwise agreed. Additionally, there are flat administrative fees of about 100 – 150 Euros.
The agent’s fees amount to a total of 4%, and the buyer and seller share the costs equally unless otherwise agreed.
Earthquake insurance costs are dependent on the essential properties of the real estate such as construction year, size, height, etc.
Plots with building permits
Foreigners can purchase plots with building permits from the Land Registry Office while adhering to legal restrictions and the procedure outlined below. However, it is necessary that foreigners develop a project for the plot with building permits. When acquiring a plot, the following annotation is found in the annotation section of the land register, “the realization of the project requires approval to be submitted to the relevant ministry within two years.” After the plot has been purchased from the Land Registry Office, foreigners must submit this project to the relevant ministry for approval within a two-year period.
Project Submission: The project is submitted to the ministry for approval, specifying the start and end dates. The letter stating that the project has been approved is sent by the ministry to the Land Registry Office, specifying the start and end dates. The project is realized within the indicated period and is finally communicated to the ministry.
Agricultural plots
At the start of the land registry procedure for acquiring an agricultural plot, the Land Registry Office requires the foreign buyer to provide a declaration of commitment regarding the purpose of the purchase to forward this declaration to the Ministry of Food and Agriculture.
The declaration of commitment and information about the plot submitted to the Land Registry Office are sent to the Ministry of Food and Agriculture. If the ministry gives its consent, the plot can be sold to foreigners. During the completion of the sale, the following note is entered in the annotation section of the land register: “the realization of the project requires approval to be submitted to the Ministry of Food and Agriculture within two years.”
Project Submission: The project is submitted for approval to the Food and Agriculture Authority, indicating the intended use of the agricultural plot. If the project is deemed appropriate, it is approved by the provincial authority. If the start and end dates of the project are not approved upon review, they can be re-determined by the provincial authority. The buyer must comply with this. If documents are missing, the buyer is given a 30-day period for rectification. After the project is registered with the Land Registry Office, the provincial authority may conduct an on-site review of the project. If there are deviations from the project, the property owner is given a 30-day period to rectify the deficiencies after a warning.
Renting and Managing Real Estate in Turkey
Foreigners can rent out their properties in Turkey without restrictions and as desired. If the property is rented for commercial purposes, foreigners and Turkish citizens residing abroad are exempt from income tax. If the property is rented as an apartment or house, the foreigner and Turkish citizens residing abroad have a tax exemption up to 7,000 TL and must pay income tax between 15 to 40% on the remainder and, of course, must file an income tax return.
The essential phase begins only after the purchase of a property in Turkey:
– Handling all further official registrations such as with the municipality, electricity, water, etc.
– Managing the property in the absence (representation at owners’ meetings, maintenance service, property management, etc.)
– Renovations, repairs
Real Estate Research in Turkey
Your debtor, your testator, or your spouse may own properties in Turkey, about which you may not have any information.
The real estate of a Turkish national (or “Mavi Kart” -also called a Blue Card- holder, former Turkish citizen) can be checked nationwide by a lawyer with the identity number. If you do not know the identity number of the person, the check would also be possible under the full name and father’s name of the person.
In this context, we can also identify “passive” properties that have already been sold. This would enable you to file land registry appeals or compensation lawsuits.
Claim for a residence permit after the purchase of property in Turkey
Property owners have a right to a residence permit in Turkey. The application can either be made at the Turkish consulate or at the foreign authority in Turkey within the applicable visa period.
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