Your Property Purchase Legal Protection
KILIÇ & Partners Law Firm Istanbul have the knowledge and experience in advising both high net worth individuals and corporate entities in the acquisition of private or commercial real estate within Turkey. Our local & global market knowledge, with and unrivalled multilingual legal team provides our clients with the legal strength in their own language as required, when considering the complexities for foreign entities, buying or leasing property in Turkey. Purchase agreements, loans and financial transactions and commercial contract terms must be prepared and notarized in both, Turkish & the Buyers native language for them to have a validity in a Turkish court of law.
We can offer a full "property legal pack" for the purchase of a property by investors, companies or individuals, in their native language and prepared by a native qualified lawyer. We do not provide a translation of a turkish contract, we provide bona fide full legal contract to your particular specifications, which is prepared by a lawyer from your own country, whether you are English, German, British, French, Dutch, Spanish, Italian, or Portuguese we have fully qualified native lawyers to deal with your transaction in your native language, allowing you to understand exactly the issues and formalities required.
Please see an example of our Property Purchase Legal Pack
What You Need to Know Before Puchasing a Property in Turkey:
There are Seven Main Points to Consider
Purchase of real estate by foreign legal entities
Purchase of real estate by companies with foreign capital
Issues to be considered prior to the purchase
Cases when ownership right ceases to exist
Procedure of sale and purchase of real estate
Expenses and additional charges
According to Turkish Real Estate regulation, there is a limitation on countries, whose citizens may purchase a real estate in Turkey. Therefore, buyer has to be national of the country, whose citizens may acquire property or limited rights may apply in Turkey.
Turkey eased and expanded the number of countries whose nationals can acquire property in Turkey considerably, from 53 to 129. In addition, law stipulates also 52 countries, whose citizens may acquire ownership with restrictions. Such as citizens of China, Denmark, or Israel are allowed to buy one residence. Citizens of Jordan, for instance, can purchase two residences and one place of business. Citizens of Armenia, Cuba, Nigeria, North Korea, Syria, and Yemen are not allowed to buy real estate in Turkey.
In addition to restriction of nationality, there are restrictions as to size and type of the property a Foreign national when acquiring a property in Turkey.
A buyer does not need to have a residence permit, as it is not a pre-condition for the purchase. Likewise, however, purchasing a property does not grant a residence permit to a buyer.
Acquisition by foreign legal entities
The Land Registry Law No 2644 governs acquisition of property by foreign legal entities registered in Turkey (i.e. Article 35):
Foreign commercial corporations may acquire real estate and limited in rem property rights in accordance with special laws: Petroleum Law No. 6326, Law No. 2634 on Encouragement of Tourism, and Law No. 4737on Industrial Zones;
There are no mortgage restrictions with regard to these companies; and
Other foreign corporations, such as foundations or associations, cannot buy property and acquire limited in rem right.
Acquisition of property by companies with foreign capital
The companies with foreign capital,
If foreign investors hold, individually or collectively, 50 % or more shares of the said company,
If foreign investors do not hold any share of the said company, but have a right to assign or remove managers of the said company on condition that the said company has a legal personality in Turkey,
They may purchase property in Turkey in accordance with Article 36 of the Land Registry Law No. 2644 and the “Decree on acquisition of property and limited in rem rights by companies and corporations within the context of Article 36 of Land Registry Law No. 2644” dated 16.08.2012.
Persons with foreign nationality may purchase maximum of 30 hectares of property in Turkey in total and may acquire limited in rem right;
Persons with foreign nationality may not acquire or rent property within military forbidden zones and security zones;
Persons with foreign nationality may acquire property or limited in rem right in a district/town up to ten per cent of the total area of the respective district/town;
Legal restrictions do not apply for setting mortgage for natural or legal persons established in foreign countries;
Real estate is subject to winding up provisions in cases where:
Real estate is acquired in violation of law;
The relevant Ministries and administrators identify that the properties are used in violation of purpose of purchase;
The foreigner does not apply to the relevant Ministry within time in case the property is acquired within a project commitment; and/orProjects are not materialized in time.
Transfer of ownership over real estate in Turkey is possible only with an official deed and registration at the Land Registry Directorates. The owner (or his/her authorized representative) of the property at stake should make a preliminary application to the Land Registry Directorate with submission of the following mandatory documents:
Tittle deed for the property or information on village/district, block, building plot, and detachment;
Identification document or passport (along with its approved translation);
Property Value Statement Document” from the relevant municipality;
Compulsory earthquake insurance policy for the buildings (house, office, etc.);
1 photo of the seller, 2 photos of the buyer; and
If the power of attorney is issued abroad, the original or certified copy of the power of attorney and its approved translation.
If one of the parties does not speak Turkish, a certified translator and 2 witnesses are required to be present.
It is possible to sign a ‘Sales commitment agreement’ at a notary; however, the ownership over the property will not be transferred based on the agreement only, i.e. without a specific procedure at the Land Registry.
The Turkish military authorities must authorize all purchases of real estate in Turkey by foreign nationals, in order to ensure that the property is not in a restricted area.
Both seller and buyer have to pay the title deed fee of 2 per cent, calculated according to the selling price; however it cannot be less than the ‘Property Statement Value’ issued by relevant municipality.
Furthermore, circulating capital fee, which is determined locally has to be paid (maximum 70*2,5 TL in 2013). Also, at the stage when the Land Registry Directorate inquires whether the property is located in the military or special zone, circulating capital fee for preparation of a map needs to be paid (323 TL in 2013).
Issues to be considered before purchase
Prospective buyer and non-national of Turkey should inquire whether the real estate he is planning to acquire is not subject to certain restrictions, which prevent it from being sold (e.g. mortgage, arrest or any other obstacle).
In case of rejection of application by the Land Registry Directorate, the matter can be appealed to the relevant Regional Office of the Land Registry Directorate.
In case of a dispute, a case should be brought before the Turkish courts.
For more Information on Property Investment or Commercial Real Estate, please consult a member of our International Legal Teams
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