FAQ – Property Purchase

When buying or selling a property in Turkey, there is a standard property purchase tax of 4% of the property’s sales price. This tax must be paid to the Turkish tax authorities. However, in practice, this cost is typically split between the buyer and the seller, making each party responsible for paying 2% of the property’s value.

The property tax payment is essential for the transfer of ownership and should be completed at the time of title deed transfer (Tapu). It’s important for both buyers and sellers to be aware of this tax obligation during the transaction process.

Key Points:

• Total Tax: 4% of the property’s sales price.
• Split Responsibility: 2% for the buyer and 2% for the seller (commonly).
• The tax is payable during the property transfer process.

A title deed, or “Tapu” in Turkish, is a legal document that serves as proof of property ownership in Turkey. This essential document includes detailed information about the property, such as its location, the owner’s name, property type, and size. The title deed is a critical part of any real estate transaction and ensures the legal ownership rights of the individual or entity holding the deed.

In Turkey, ownership can be shared by multiple individuals without a limit on the number of owners. Additionally, all properties are freehold, meaning that after the titleholder’s death, the ownership rights automatically pass to their heirs. Alternatively, the property owner can leave the property to anyone through a legally binding will.

Key Points:

• Proof of Ownership: Confirms legal rights to a property.
• Details Provided: Location, owner, property type, and size.
• Shared Ownership: An unlimited number of people can share ownership of a single property.
• Freehold Property: Automatically inherited by family members or as designated in a will.

When purchasing property in Turkey, buyers should be prepared for several additional expenses that come before, during, and after the transaction. Understanding these costs helps ensure a smooth purchasing process and avoids financial surprises.

Here is a breakdown of the main expenses:

• Appraisal Report Fee (Real Estate Valuation): The valuation report is a mandatory requirement. It must be provided during the property purchase process.
• Title Deed Conveyance Costs (Property Tax): Property tax is 4% of the property’s sale price, and it is typically split equally between the buyer and the seller, with each party paying 2%.
• Lawyer Expenses: Although hiring a lawyer is optional, it is highly recommended for foreign buyers to ensure that all legal procedures are properly followed.
• Value Added Tax (VAT): VAT on property purchases in Turkey varies depending on the type of property. It can range from 1% to 20%, depending on factors such as property size, price, and location.
• Property and Earthquake Insurance (DASK): Earthquake insurance is mandatory in Turkey. While additional property insurance is optional, it is highly advised for further coverage.
• Utility Connection Fees: New owners are required to pay for electricity and water connection, which varies depending on the region and the provider.
• Furnishing Costs: Furnishing an unfurnished property is an optional expense and varies based on personal preference.
• Monthly Maintenance Fees: Commonly known as “aidat,” these fees cover the upkeep of shared facilities and services. The amount varies based on the amenities offered by the property.

The time it takes to complete a property purchase in Istanbul largely depends on the buyer’s decisions and the payment process. Once you’ve selected a property, the transaction follows these key steps:

• Put a Deposit on Your Selected Unit: After choosing the property, you will need to place a deposit to secure your unit.
• Receive the Reservation Form: Upon making the deposit, you’ll receive a reservation form confirming your intent to purchase the property.
• Send the Total Amount or Downpayment: On the agreed payment date, either transfer the full amount or make the required downpayment if you’re purchasing via installment plans.
• Get Your Sales/Notary Agreement: Once payment is made, the sales contract or notary agreement is signed, finalizing the legal commitment.
• Title Deed Office Appointment (for Cash Payments): If the property is paid in full, the next step is to schedule an appointment with the title deed office.
• Receive Your Title Deed: On the day of your appointment, the government will officially transfer ownership, and you will receive your title deed.

The entire process can take anywhere from a few days to a few weeks, depending on the project’s payment plan, the completion of paperwork, and title deed office availability.

To successfully purchase property in Turkey, you’ll need to prepare and present several key documents. Here’s what you will need:

• Passport: A valid passport is essential for verifying your identity during the transaction.
• Local Tax Number: You will need to obtain a Turkish tax number, which is necessary for property transactions. We can assist you in acquiring this.
• Utility Bill from Your Home Country: A recent utility bill from your residence will be required to open a Turkish bank account, which is necessary for transferring funds.
• Two Passport-Sized Photos: You’ll need two recent photographs measuring 3cm by 4cm for various documentation purposes throughout the purchase process.

By gathering these documents ahead of time, you can streamline your property buying process in Turkey.

The timeline for moving into your newly purchased home in Turkey primarily depends on the payment terms set by the developer. Here’s what you need to know:

1. Brand-New Apartments: If you purchase a brand-new apartment from a construction company, you are generally allowed to move in once you have paid at least 50% of the total price.
2. Full Payment: In some cases, developers may require the full payment to be completed before granting access to the property.

It’s essential to clarify these terms with the developer during the purchasing process to ensure a smooth transition into your new home.

In Turkey, the VAT rates are set at 1%, 8%, and 18% by law. For the purchasing real estate, it generally is 18%. However, if the investor meets the conditions stated by law, it is possible to take advantage of the VAT exemption. 

According to the Law, the rate of title deed fee is 4% of the sales price. The Buyer and Seller pay the title deed fee over the sales price. Depending on the deal, title deed fee terms may vary. While some owners require the Buyer to pay the total cost, some ask to share it in half. 

Yes. All the foreign buyers should take a valuation report for their investment.

For foreign investors, the lawmaker made a valuation report obligated. The price of the valuation report varies between 1.500 TL and 4.000 TL.

For people who cannot read or write Turkish, a sworn translator is required for the transaction. The translator will be explaining the terms and details of the title deed records. The translator’s fee for oral translation varies from 400 to 600 TL.

It is possible to handle the TAPU transaction with an authorized person. However, the person should be authorized specifically to be represented in the TAPU Office with a Power of Attorney (POA). In Turkey, only the Notary Public is empowered to prepare the POA. For the POA, the price varies between 700-1000 TL.
Notary agreement costs mostly around 1% of the total amount.

Every residential site has its specific social facilities and services provided to homeowners and residents. Rates depend on the place property is located and the size of the house. The maintenance fees start from 100 TL and go up to 2.000 TL.

Government title deed Office is given the appointments in 15 days mostly.

Yes, purchasing property in Turkey through an installment plan is a viable option, depending on the specific project you choose. Here’s what you need to know:

1. Availability of Installment Plans:
   • Many real estate projects in Turkey offer flexible payment plans that allow buyers to pay in installments. However, the availability of these plans varies by developer and project.
2. Understanding the Terms:
   • If the project has an installment option, it’s crucial to review the terms and conditions. This may include details such as the duration of the payment plan, the required down payment, and the interest rates if applicable.
3. Choosing the Right Project:
   • When considering an installment plan, take the time to explore different projects and developers. Some may provide more favorable payment terms than others, making it essential to find one that aligns with your financial goals.
4. Consultation:
   • Always consult with a real estate agent or lawyer familiar with Turkish property laws to ensure you understand your obligations and rights regarding the installment payment process.

This flexibility in payment options can make purchasing property in Turkey more accessible for many international investors.

If you earn rental income in Turkey, you are subject to a tax rate of 15% on your total annual income. Here’s a breakdown of what you need to know:

1. Tax Rate:
   • The tax on rental income is set at a flat rate of 15% of the total income received from renting out your property for the year.
2. Filing Requirements:
   • Property owners must report their rental income to the Turkish tax authorities annually. It’s important to keep accurate records of all rental income received throughout the year to ensure proper reporting.
3. Deductions:
   • You may be eligible for certain deductions related to property maintenance and management expenses, which can reduce your taxable income. It’s advisable to consult a tax professional to understand what expenses can be deducted.
4. Payment Deadline:
   • Ensure you are aware of the deadlines for filing your tax returns and making payments to avoid penalties.

Understanding your tax obligations as a rental property owner in Turkey is essential for effective financial planning and compliance with local laws.

When selling a property in Turkey, the applicable tax rate depends on how long you have owned the property:

1. No Tax After Five Years:
   • If you sell your property after five years from the purchase date, you are exempt from paying capital gains tax on the sale. This provides an incentive for long-term investment in real estate.
2. Tax for Sales Within Five Years:
   • If you decide to sell your property within five years, you will be liable to pay a profit tax. This tax is calculated based on the difference between the purchase price and the selling price.
   • The profit tax rate is typically around 20% of the profit you made from the sale.
3. Calculating the Profit:
   • To determine the profit, subtract the original purchase price (including any associated costs, such as legal fees) from the selling price. This figure represents your taxable gain.

Understanding these tax implications can help you make informed decisions about your property investment strategy in Turkey.