REAL ESTATE ACQUUISITION BY FOREIGNERS IN TURKEY
In the past decade purchasing property in Turkey became very popular through holiday homeowners and investors worldwide. The first time that it was permitted to foreign buyers to purchase real estate in Turkey was in the year of 1934 with the Land Registry Law. At the present day the real estate market in Turkey is developing and becoming one of the prominent markets in the World.
In accordance with the Article 35 of the Land Registry Law Nr. 2644, amended by Law Nr. 6302, which entered into force on 8 May 2012, the condition of reciprocity for foreigners who wish to buy property in Turkey is abolished.
Information on countries whose citizens can buy property and real estate in Turkey can be provided from the Turkish Embassies/Consulates abroad and the General Directorate for Land Registry and Cadastre.
Persons with foreign nationality can buy any kind of property (house, business place, land, field) within the legal restrictions.
Persons with foreign nationality who buy property without construction (land, field) have to submit the project, which they will construct on the property to the relevant Ministry within 2 years.
Format Of The Contract
According to the Turkish laws and regulations in force, transfer of ownership of a property is only possible with an official deed and registry, which is signed at the Land Registry Directorates.
It is possible to sign a “sales commitment agreement” in a notary. However, legal ownership of the property does not transfer with a “sales commitment agreement” or other kind of sales agreements to be signed in the notary.
Legal Restrictions For Foreigners In Buying Property
a) Persons with foreign nationality can buy maximum 30 hectares of property in Turkey in total and can acquire limited rem right.
b) Foreigners cannot acquire or rent property within military forbidden zones and security zones.
c) Persons with foreign nationality can acquire property or limited rem right in a district/town up to 10 % of the total area of the said district/town.
d) Legal restrictions do not apply in setting mortgage for real persons and commercial companies having legal personality, which are established in foreign countries.
e) The properties are subject to winding up provisions in following cases:
• if the properties are acquired in violation of laws;
• if the relevant Ministries or administrations identify that the properties are used in violation of purpose of purchase;
• if the foreigner does not apply to the relevant Ministry within the time in case the property is acquired with a Project commitment;
• if the projects are not materialized within the time.
Application And Procedure
Buyer should be from the country whose citizens can acquire property or limited in rem right in Turkey and meet the necessary conditions.
Application: The owner of the property or his/her authorized representative should make a preliminary application to the Land Registry Directorate. (Preliminary applications are made before noon by taking sequence number)
If the preliminary application is incomplete, the file will be kept waiting.
a) Tittle deed of the property or information on village/district, block, parcel,independet section number.
b) Identification document or passport (Together with its translation).
c) “Property Value Statement Document” to be provided from the relevant municipality.
d) Compulsory earthquake insurance policy for the buildings (house, office, etc.)
e) One photo of the seller, two photos of the buyer (taken within last 6 months, 6x4 cm. size)
f) If one of the sides cannot speak Turkish, certified interpreter,
g) If transaction will be performed with a power of attorney issued abroad, original or certified copy of the power of attorney and its approved Turkish translation.
Information On Powers Of Attorney Issued Abroad
Powers of attorney are issued by the Turkish Embassies or Consulates. If the power of attorney which is issued by a notary of a foreign country is certified according to The Hague Convention dated 5 October 1961 and if it bears “Apostille (Convention de La Haye du Octobre 1961)” in French, there is no need for an additional certification of the said power of attorney by the relevant Turkish Consulate.
If the power of attorney is issued by a notary of a foreign country which is not party to The Hague Convention date 5 October 1961, the signature of the said notary has to be certified by the relevant authority of the foreign country and then the signature and seal of the said foreign authority have to be certified by the Turkish Consulate in that country.
Financial Aspect Of The Procedure
a) Both seller and buyer have to pay the tittle deed fee, calculated according to the selling price, which cannot be less than the “Property Statement Value” to be issued by the relevant municipality. (According to the Charges Law No:492, the title deed fee is 2%.)
b) Revolving Fund fee which is determined by local coefficients has to be paid. (Maximum 103,5 x 2,5 TL for 2018)
c) In the ownership transfer transactions in accordance with Article 35 of the Land Registry Law Nr. 2644, a fixed fee shall be charged by Land Registry office, in addition to determined revolving fund service fee for the transaction. (for the year 2017: 422,5 TL)
Other Issues For Foreigners Who Wish To Buy A Property In Turkey
• The foreigner has to inquire with the Land Registry Directorate if there is any limitation on the property, such as mortgage, arrestment or any obstacle, which prevents the sale of the property.
• If the application of the foreigner for buying a property is rejected, appeals can be made to the relevant Land Registry and Cadastre Regional Directorate.
• It is advised that foreigners do not work with persons/companies who/which are not expert or reliable.
• Having a residence permit is not a condition for the foreigner who wishes to buy a property in Turkey.
• If there is a disagreement between the sides on the sale of the property, the case has to be brought before the Turkish courts by referring to judicial authorities.
Acquisitions By Foreign Companies
Acquisition of property by foreign companies, which are registered in Turkey, is regulated by Article 35 of the Land Registry Law No 2644.
a) Foreign commercial corporations which are established according to the relevant laws of their countries of origin can acquire property and limited rem rights within the provisions of private laws. These private laws are:
• Turkish Petroleum Law Nr. 6491
• Law on Encouragement of Tourism Nr. 2634
• Law on Industrial Zones Nr. 4737
b) No restriction is implemented in favor of the said commercial companies in establishing mortgage.
c) Other foreign corporations (i.e. foundation, association, ...) cannot buy property and acquire limited in rem right.
Acquisition Of Property By Companies With Foreign Capital
The companies with foreign capital,
• If the foreign investors hold, individually or collectively, 50 % or more shares of the said company,
• If the foreign investors do not hold any share of the said company, but have a right to assign or remove the managers of the said company on the condition that the said company has a legal personality in Turkey, could buy property in Turkey in accordance with Article 36 of Land Registry Law Nr. 2644 and the “Regulation on Acquisition of Property and Limited in Rem Rights by Companies and Corporations within the Context of Article 36 of Land Registry Law Nr. 2644”, dated 16.08.2012.
• General Directorate of Land Registry and Cadastre has published a circular Nr. 2012/13 (1735) on “acquisition of property and limited in rem rights by companies with foreign capitals”
For more information https://www.tkgm.gov.tr/tr/daire-baskanliklari/yabanci-isler-dairesi-baskanligi