Why Buy in Turkey?
Turkey is a wonderful country to live or retire to. Many people move there to experience a happy, fulfilling quality of life. The climate reaches scorching temperatures during the summer and Turkey is home to some of Europe’s most beautiful coastlines. You can enjoy sunshine for more than 300 days of the year, not to mention the fantastic sailing opportunities for keen yachtsmen. Turkeys ports are becoming increasingly popular and the country is full of nautical history and referenced in much famous literature. With over 8000 kilometres of coastline to explore, activities such as river rafting, scuba diving and sea kayaking are available to enjoy all over. Not to mention the incredible views you will get from hot air ballooning and paragliding!
How to buy property in Turkey
Buying property in Turkey can be a safe and easy process provided buyers use the services of a reputable estate agent and/or solicitor. However the recent development of the Turkish market has encouraged the growth of opportunists, selling property from bars and even from the back of taxis. So just be cautious from whom you buy.
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Foreigners are allowed to buy property in Turkey providing it has a government Title Deed recorded at the Land Registry. Properties in many village areas have title deeds under a separate ownership system and can not be purchased freehold by foreigners at the time of writing.
Once a sale is agreed the buyer must give a minimum deposit of 10% to secure the property. A contract will be drawn up at this stage and/or the buyer can give a power of attorney to the agent or lawyer. The deposit becomes binding and should the buyer change their mind it is non refundable. In the event the seller pulls out the deposit will be refunded and some agents and lawyers will enforce a penalty clause.
At completion the balance of the agreed price is sent by the buyer to the agent or lawyer and both buyer(s) and seller (s) must meet in person at the title deed office to undertake the transfer of title. If the property is to be purchased in joint names all buyers must be present.
The easiest way for foreigners to buy is to give power of attorney to the estate agent or lawyer. In this case the buyer does not need to return to Turkey to complete, there by saving valuable time and money. The agent can hold the title deed and keys until it is convenient for the buyer to return.
The only anomaly in the Turkish buying process is the requirement of an approval paper from the Military in Izmir . This application is made to ensure that the foreigner is buying property within the permitted areas, i.e. those which do not constitute national forestry or are located close to military installations. The application is made by the agent or lawyer and requires a photocopy of the buyer’s passport and details of the property to be submitted. The approval is usually granted 12 weeks later, after which the buyer can complete. If the property is already in foreign ownership or on a site e.g. apartments, where other foreign owners are already present, the permission is automatic and the sale can proceed without delay. The agent or lawyer can give advice as to whether an application must be made or not.
It is Turkish practice that buyers pay a commission to the estate agent when purchasing Turkish property. This commission is usually 3%. Stamp duty is also payable at 3% of the council valuation of the property. Currently this valuation is less than the purchase price. The agent or lawyer can give advice as to what the council valuation is likely to be for the calculation of purchase tax.
On completion all residential property must have obligatory government DASK insurance. After completion buyers should take out additional private insurance to increase the level of building cover and to insure contents. They will also need to re register the property with the local authority for payment of council tax and with the utility companies. The utility companies will levy a charge for this service and may require a security deposit. For the connection of a new telephone line, foreigner owners must first apply for a residential visa. This application can be made in at the Turkish Consulate in London and ratified by the authorities in Antalya . A residential visa will also be necessary should owners wish to ship their house contents into Turkey from abroad.
Post purchase, foreign owners should undertake a Turkish will. Whilst property in Turkey will not revert to government ownership on death, there are differences in Turkish inheritance law and foreign owners should ensure they are protected.
Check out your choice of location. Visit property websites to get an idea of what properties are available and at what price. Then decide which combination of location, property type and price is most suitable for you.
Whether you plan to visit Turkey to buy or just to conduct some research, you need to know your financial position. If you are buying with borrowed money speak to the lender and get a written confirmation of the amount you can borrow and the time scales involved. Currently it is not possible to raise a mortgage in the UK secured on a Turkish property. If you are planning to by with borrowed money therefore, you must use a UK based asset as security.
If you are looking to secure a property during your visit with cash, know the timescales involved to release money from accounts and transfer it to Turkey. Most UK banks will accept a faxed transfer authorization but you need to arrange this with them prior to your visit. Like wise deposits can be made with a cash advance on a credit card, but you will need to inform your credit card company before you fly.