Turkish real estate law
Part I
Works of law
  • Bonds Code: for building contract law
  • Civil Code: for property law, e.g. transfer and encumbrance of land
  • Land Register Act: guidance land register, registration procedure
  • Consumer Protection Act: also applies to self-occupied real estate
  • Stock Property Law / Cooperative Law: applies to home ownership and time ownership
  • Monument Protection Law: this may result in further restrictions on the protection of cultural assets

Under Turkish law, the legal transactions of buying and selling are reserved for the land registry only. Notaries are not authorized. A notary, on the other hand, can contractually bind the seller's obligation to sell to a specified customer as well as define payment arrangements. Nevertheless the actual transfer of the real estate always takes place at the Land Registry.

>> Attention << There is a high risk if the complete purchase price or considerable down payments on the purchase price are conducted before actual transfer of land in front of the land registry. Even if the seller has contractually agreed to transfer the property to a notary, the buyer does not own the property without the legal acts at the land registry despite the purchase price possibly already fully paid. Therefore, the performance of the full purchase price before transfer before the Land Registry is not recommended.

The land register (= Tapu) enjoys public beliefs. This means that objects are only charged if there is a corresponding entry in the Tapu. The same applies to ownership - owner is the natural or legal person, which is listed in full in the Tapu!

Important changes over the years

Law No. 5444 of 29.12.2005, published on January 7, 2006 in the Official Gazette No. 26046, reallocated the real estate acquisition in Turkey by foreign natural and legal persons.

With the amendment of Article 35 of the Land Registry Act No. 2644, the acquisition of real estate by foreign natural persons as well as corporations with legal personality, which were established abroad under the laws of the respective country, was placed on a new basis in Turkey.

Accordingly, foreign natural persons, subject to reciprocity and observance of the relevant legal restrictions, may acquire real estate for the purpose of use as a business or residence, which have been registered for this purpose in a qualified development plan or local development plan.

A renewed legislative amendment in 2012 (Law No. 6302, published on May 18, 2012 in the Official Gazette No. 28296, Art. 35 and 36 of the Land Registry Act) introduced further relief. For example, e.g. The principle of reciprocity for a list of countries, including Germany, has been dropped. Furthermore, the area acquired by foreigners has risen to 30 hectares. For details, see below.

Restrictions

The total area of real estate acquired by foreign natural persons in Turkey may not exceed 30 hectares (300,000 square meters). On justified request of the Council of Ministers, this area can be extended to 60 hectares.

For property transferred by inheritance to nationals whose state is reciprocal with Turkey, these restrictions do not apply. Reciprocity means that the other state has also made a similar provision. Due to the abolition of the principle of reciprocity mentioned above, this restriction no longer applies to Germany.

Corporations with legal personality established abroad under the laws of their country of origin may acquire real estate in compliance with special legal provisions.

Further restrictions apply in restricted and security zones.

>> Attention << This also applies if a property falls within the scope of an inheritance to a foreigner. This may be important for couples of different nationality. In addition, there are exceptions for rural areas that are located in tourist areas, including Alanya including surrounding villages.

Outside the village boundaries, according to the new law, a maximum of five per thousand of a territory may be sold to foreigners. It is still not clear how the term area or tourist region is to be defined. Here are further provisions and judgments to wait.

For flats this should not play a big role, because the land area is counted even when several apartments sold only once as foreigners.

Costs and taxes

The actual transaction must either be made by the person concerned at the Land Registry or by a representative with a notarised proxy. When transferring ownership, buyers and sellers pay 0.015% of the property value as a land register fee (unless otherwise agreed). Furthermore, 3% of the property value is a real estate transfer tax.

Digression - In Germany, the land transfer tax amounted to 3.5% nationwide by the year 2006. Since 2007, there is the possibility of country-specific tax rates, of which, e.g. the Land Berlin made use of and increased the land transfer tax to 4.5% of the tax base. Back to Turkey - The land registry charges a processing fee of about 50 euros, for the interpreters prescribed for sale to foreigners about 50 euros.

Also of importance is the 'Iskan' if you build yourself. With the Iskan the client announces the existence of living space. Without the Iskan can be no supply of electricity, water and telephone, as officially no habitable real estate exists. When buying an already built property, the Iskan can usually be ignored, as it should already exist.

From this by far not complete overview it becomes clear that the regulations to be observed are complex and extensive. Therefore, get competent advice before and during the purchase.

Part II
Acquire and inherit

Real estate is acquired through transfer of ownership on account of contractual obligations (purchase or donation), ordinary and extraordinary residency, connection and appropriation and finally by inheritance.

The acquisition is generally governed by Turkish law. For example, it is not possible to settle a property in accordance with German law. This also applies to the inheritance. For German citizens, details to avoid double taxation in the double taxation treaty Turkey Germany are regulated.

The acquisition of ownership of land is done by registering the new owner in the land register - the registration in turn is made on the basis of mutual undertakings to be made before the land registry official and on which a public deed (resmî senet) is issued.

This document forms the actual purchase contract. After the purchase is completed, the Tapu will be handed over for the property. This document is legally valid as a proof of ownership.

In a case of inheritance, a valid certificate of inheritance is required. In general, certain legal or factual circumstances preventing the unrestricted exercise of property rights are noted in the land register in a separate column (for example, provisions on monument protection).

Land sale promise

Many contracts concluded by Turkish developers with foreign buyers are a mix of construction contract and land sale promise. However, this is not a valid purchase. Because the actual land sale promise (gayrimenkul satis vaadi) is only a preliminary contract, which is notarized and includes the obligation to go together or with representatives to the land registry office, and then there complete the actual sales contract.

However, the customer often does not notice this, because the developer can usually also be appointed as the authorized representative.

>>Attention: << Above all, however, the sales promise does not constitute a sufficient obstacle for the seller to hand over the property elsewhere. Therefore, the widespread practice of initially charging 50% of the purchase price presents a risk that should not be underestimated for the buyer.

A certain security provides the reservation in the land register (serh) - this procedure can also clarify the question of whether the foreigner can acquire property in Turkey at all or oppose the obstacles.

Although the reservation does not prevent the acquisition by a previously uninvolved third party, but leads to the transfer claim is now directed against this.

Property Purchase Agreement

The land purchase agreement (gayrimenkul satis sözlesmesi) itself is not closed before the notary, but before the land registry by the establishment of a public deed (resmi senet).

This means that land purchase contracts concluded before a German notary do not have any effect but can at best be interpreted as sales promises. Possible grounds for refusal are examined by the Land Registry before the establishment of the deed of purchase.

Construction contract

In the area of holiday real estate belongs, if the house is not already turnkey, in the contract construction contract for the construction works (insaat sözlesmesi), which has to provide the developer or seller - this contract does not require any special form.

In addition to time limits for individual phases of construction, it may also contain contractual penalties, the concretisation of the construction work is usually carried out by means of a construction list, which is often insufficiently specified in practice, with the result that the buyer is often confronted with surprising additional demands for non-original 'special services' is provided.

So far, the acquisition of land by foreigners was possible if the law of the buyer's home country also granted equal rights to Turkish citizens. The principle of reciprocity designates and is often used in international legal relations. With the amendment of the Land Registry Act of 18.05.2012 (Law 6302, Resmi Gazete No. 28296 of 18.5.2012), the requirement of reciprocity for a list of countries, including Germany, has disappeared!

As already mentioned, the acquisition of up to 30 hectares is possible. Additional areas (up to a maximum of 60 hectares) may be acquired if there is a corresponding decision of the Council of Ministers.

Acquisition of floor property

In the area of holiday real estate, the supposedly most common form of property acquisition is the one based on the law on condominium ownership.

This form of ownership is similar to the residential property in Germany. One acquires a co-ownership share of the whole building determined by pre-determined yardsticks - this can be also a holiday resort - whereby the buyer receives a certain housing unit and a corresponding entry in the land register is made.

Condominium ownership only arises with the completion of a building. Before that exists only a kind of expectancy (kat irtifaki).

The size of the share depends on various factors such as living space and the scope of other uses and services. This is usually followed by the calculation of the purchase price.

The amount of the purchase price may in part also depend on the purchasing power of the customer, since the corresponding ownership interest is fixed in the land register and can only change if later, for example due to further construction measures, residential units are added.

Kat irtifaki is created with a land register divisional declaration, which is obtained by the landowner or the community of landowners.

This process is usually already completed in practice, if such land or land shares are offered for sale. The shares are transferred similar to real land. At the end, after completion of the structure, real co-ownership (kat mülkiyeti) arises - again on request.

Even the "kat irtifaki" can be mortgaged.

Acquisition of time ownership

If you use your domicile only once a year for a certain period of time, you can use the construction of time ownership. Purchase terms and conditions are similar to the rules for the ownership of a property and are therefore governed by the same law.

However, the property rights refer to the period to be entered in the land register, which must not be less than two weeks. This form of ownership can be sold, pledged or mortgaged.

Time ownership is not to be confused with the model of time-sharing, in which no comparable property rights arise, but rather debt claims, which are usually not tied to a particular property.