Buying in Turkey's property market as a foreigner
Planning to spend your vacation in Turkey? If you're looking for a new home, retirement destination, or investment opportunity, Turkey may be the place for you. There is a wide variety of exciting cities and relaxing beach resorts to choose from in this enormous country. The inexpensive property is certainly a major selling point.
Here, you'll find a comprehensive overview of the steps required to purchase real estate in Turkey as a foreigner. We'll talk about the process of obtaining a "Golden Visa" to Turkey so that you can retire in Fethiye's warm climate, as well as the cost of purchasing property in Bodrum.
But first, let's take a glance at Turkey's real property market.
Just how stable is Turkey's real property market?
Over the past year or so, property prices in Turkey have skyrocketed, increasing by as much as 30 percent in early 2021. As a result, the market is tilted in favor of sellers. However, there has been a recent uptick in home building and rehabilitation projects2, which speaks well for potential buyers.
Over the past few years, interest from international buyers has skyrocketed for real estate in Turkey. This fell because of the Covid-19 pandemic1, but local demand and falling interest rates2 have kept the real property market afloat.
Can non-Turkish citizens purchase property in Turkey?
In order to buy real property in Turkey, you need neither Turkish citizenship nor permanent residency. However, foreigners may still need to apply for a visa or resident permit in addition to buying a home in Turkey before they may legally reside there.
- Before beginning a property search in Turkey, international buyers should also be aware of the following restrictions:
- The maximum amount of property that a foreigner can buy in Turkey is 30 hectares.
In military restricted and military zones, real property transactions are prohibited.
Can one feel safe buying property in Turkey?
Getting accustomed to the local legal system is just one of the many reasons why buying property abroad will always feel riskier than doing it at home.
Foreign buyers haven't always looked favorably on Turkey's real property sector. Some prior buyers were put off by reading horrific stories about scams, fraud, and other difficulties. The good news is that the Turkish government has tightened restrictions to safeguard buyers and cut down on real estate fraud in response to rising international investment.
It's still important to take precautions:
- Checking the credentials of potential lawyers and real estate agents in great detail.
- The use of professionals who are fluent in English to ensure there is no room for misunderstanding.
Can I possess Turkish citizenship by buying property in Turkey?
Turkey, like a number of other countries, offers a "Golden Visa" scheme that, in exchange for a financial commitment, allows foreigners the right to live and work in the country permanently.
Investing in Turkey in many ways, such as opening a business or depositing a particular amount of money in a Turkish bank, can lead to citizenship.
But if you spend $250,000 or more on Turkish real estate, you can become a citizen (or the equivalent in other currencies). You can apply for Turkish citizenship as soon as you receive your permanent residence card after buying a house in Turkey. It may take you as long as three to six months to get your Turkish passport.
When estimating a budget, how much might one expect to spend on a property in Turkey?
The question of how much money it will need to buy a property in Turkey is now before us. Buying real property in Turkey is typically far more cost-effective than in the United Kingdom, though this varies widely depending on the specifics of your purchase and the location.
In Turkey, for instance, a city-center apartment may be purchased for an average of just £781 GBP per square meter. Costs a whopping £4,247 GBP6 in the United Kingdom.
|Location||Price per sq.m - apartment in city centre⁷||Price per sq.m - apartment outside city centre⁷||Average price for 100 sq. m property⁸|
Turkey's top locations for buying real property
There is a wide variety of places to stay in Turkey, from bustling capitals to quiet rural retreats basked in the sun. Where you should seek for a home depends on whether it's a vacation property, retirement residence, or a place to hide out in the city.
Let's take a quick tour of a couple of Turkey's most sought-after urban centers and vacation spots amongst foreign buyers.
- About 44% of non-Turkish buyers choose Istanbul as the location for their new primary residence or investment property. It's not the cheapest location to buy, but it has excellent transportation, a thriving economy, and a rich cultural scene.
- Antalya is the second most sought after location by 21.8% of foreign homebuyers due to its affordable property costs. It has a sizable expat community and sees a high volume of tourists each year, making it a potential hotspot for short-term rentals. Additionally, Alanya, located up the coast, is often referred to as the "Pearl of the Turkish Riviera," and offers similar real property options.
- More than 5,000 Brits have made Fethiye their permanent home because of the city's attractive coastline scenery, high-quality beaches, cheap real property, and authentic sense of Turkish culture. However, if you're looking to buy a property there, you may find the area too quiet in the winter.
- Bodrum is a trendy town on the southwestern coast of Turkey that is perfect for people in search of a little bit of luxury, as well as a number of charming fishing villages. Property isn't the cheapest in the country, but there are options for just about every price range. Property isn't the cheapest in the country, but there are options for just about every budget range.
- Bursa is about an hour's drive from Istanbul, so if you're in the market for a deal, you know where to go. The city's affordable real property is just one of many attractive features, including its many museums, parks, and natural attractions like its majestic mountains.
- Ankara is a wonderful option if you want to live in a metropolis but can't afford Istanbul's real property prices. If you're an expat or international business owner, you'll love working and living in Turkey's capital. It has everything you could want.
Avoiding Common Problems When buying Property in Turkey
When buying to purchase real property in Turkey, keep the following in mind:
- If you don't do your homework before buying an "off-plan" home, you could lose money if the developer or builder goes bankrupt before your property is finished.
- Buying a rental property in a region with low expected rental returns
- Some of Turkey's older buildings were built poorly and would need a lot of money and work to bring them up to code.
- Working with reputable local experts is essential when buying real property in a foreign nation.
In what way do I find the ideal property?
Different Categories of Real property
The intriguing fusion of Eastern and Western cultures in Turkey is reflected in the country's architecture14. This means that you can choose from beautiful Ottoman townhouses to sleek, contemporary European homes along the seaside.
The northern part of the property is known for its timber-built residences, whereas the western and southern parts of the country are more likely to have stone structures.
Apartments are the most widely available and frequently purchased type of real property in urban areas throughout Turkey. Still, it's important to consider your needs, your budget, and the store from where you're buying your purchase.
Location and property condition
There is new legislation in Turkey as of 2019 that mandates a surveyor's report15 for any foreigner buying or selling property in the country. You should hire a licensed surveyor to assess the state of the property and provide a report on it.
To get the deal approved by the land registration, you'll need this, and it can also be useful in buying the property's condition.
How do I go about buying real property as an international buyer?
The steps to buying a home in Turkey are as follows.
- Do your homework on the real estate market and choose a trustworthy real estate agent; if you aren't already based in Turkey, you'll need to arrange travel there in order to visit potential homes.
- Negotiate the price and terms of purchase with the seller once you've located a property you wish to buy (your estate agent can help with this).
- In order to secure your reservation, you will be required to sign a sales contract and make a modest deposit.
- Hire a lawyer who is both impartial and competent to deal with the paperwork involved in the deal. Your identification document(s) and visa(s) or other proof of legal status(es) may be required.
- An independent appraiser needs three to four days to complete a full valuation.
- The Tapu (certificate of title) will be reviewed by your property. Send this to the Tapu office for registration, and then you'll receive a new Tapu that includes your personal information.
- You now officially own real property in Turkey.
When buying real property in Turkey, what are the necessary steps to take?
- Before buying real property in Turkey, it is important to consult a lawyer about the following critical legal details:
- In order to get your Tapu, you must first purchase DASK earthquake insurance.
- Those without valid visas must visit the TNP Foreigners' Department17 to apply for a Foreigner Identity Number.
- To create a bank account in the country, you will also require a tax identification number from the tax office.
- An Iskan certificate is required for every newly acquired real estate.
How can I apply for a mortgage or bank loan?
There are a few choices for obtaining a mortgage in Turkey for the purpose of purchasing real property. Foreigners can get a mortgage from a bank in Turkey.
Some lenders have a minimum loan amount of roughly €67,500, and the average loan-to-value (LTV) offered to borrowers from outside of the EU is 70%. Be wary of lenders who insist on doing their own property value, as the results of such an appraisal often come in 10-15% below the market price18.
Quickly reviewing the steps required to obtain a mortgage in Turkey:
- Consult a mortgage broker about your needs, and be pre-approved if you can.
- Obtain a Tax Identification Number (I.D.) in Turkey.
- Get the process of buying a property off the ground by doing things like signing the final paperwork with the Land Registry.
- Submit an application for a home loan.
- Your mortgage money should be available to you when the Tapu is ready for purchase.
Just how much will I be responsible for in taxes and other charges?
The following are some of the most common taxes and fees you may expect to pay in Turkey, though keep in mind that prices can vary greatly around the country:
- Notarial costs, starting at £200
- Similar to stamp duty, a property purchaser must pay a tax of 4% of the purchase price.
- One hundred twenty five pounds for the land registry.
- Real estate commissions average around 3 percent.
- Costs associated with hiring an attorney — at least £500.