Although the buying process in Turkey is relatively simple, the system is unlike the purchasing system in the UK and Ireland for example, so it helps if you know the basic ground rules, including what documentation you need to produce– and what documentation you should receive. With that in mind, here is a step-by-step guide to the buying process. When all the details are written down and you are reading them it can seem like a long process but it’s not! We’ve just included as much information as we can to help you along the road to buying your dream home.
1.MAKING AN OFFER
Once you find your perfect property, you either agree to buy at the asking price, or you make an offer. You inform the agent, who contacts the seller, and if the price is agreed, you (the buyer) hand over 10% of the agreed purchase price to the agent, AFTER drawing up a notarized agreement of sale, at one of the local notary offices. The agent must give you a receipt for the payment of the deposit which is best done by bank transfer, not in cash.
You may decide to buy privately from a seller without using the services of an agent, but in any case you still need to go – with the seller in this case – to the notary office, to draw up a sale agreement.
You will also, in either case, need to go to the tax office to register for a Turkish tax number, and then go to a Turkish bank to open an account. Your agent or solicitor will help with this and it is a very quick and straightforward process. Get at least 12 photocopies of your passport made, and 12 passport photos – what you don’t need now you can keep in a file for future use – as Turkish bureaucracy usually requires one or both, so they won’t go to waste! We’d suggest starting a Turkey File, and keeping all of your receipts, translated documents, photocopies, passport photos, tax card and bank documents together in a safe place.
2. BEFORE THE SALE
Before attending the notary office, you may decide to appoint a solicitor to see the purchase through for you, especially if you are only in Turkey for say 2 weeks at a time. You do not have to employ a solicitor, you can allow the agent to see the sale through if you want to, but, it is very important that the responsible party ( the agent or lawyer ) checks the title deeds for any outstanding debts, loans, mortgages etc and checks to ensure that the person selling the house is the registered owner named on the title deeds. (TAPU)
Most reputable agents will have already checked this before marketing the property, but it is best to ask for written confirmation that this has been done before you proceed. A TAPU will not be transferred if there is an outstanding debt against it, so make sure the title deeds are checked! A good agent will also check all the other documentation to make sure the house has been registered with the local council, and if it is on a complex, whether the complex is a co-operative (we’re making an article on that to follow) or a sitesi which has passed beyond a co-op and is now a completed sitesi.
2. AT THE NOTARY OFFICE
At the notary office you will sign an agreement of sale/purchase. A typical agreement will state that, if the buyer pulls out, they forfeit their deposit – the 10%. If the seller decides to withdraw from the sale (happens rarely, but there have been cases of gazumping) within the notarized agreement there will be a clause which will say that the seller not only has to repay the 10% deposit, but also has to pay the agents fees, and a penalty amount on top. This arrangement protects both buyer and seller from being messed about.
Notarised contracts are the only legally recognized form of contract, so ensure that any contract you sign is done at the notary office. Your estate agent will normally arrange to take you to the notary office to get this drawn up and signed, although you can of course appoint a solicitor to deal with the purchase at this stage. When you visit the notary, you will be expected to pay the notary costs and pay for the services of a licensed translator, who will verbally translate the documents you are signing. We would always recommend that you also pay a little extra to your translator and get the document translated into your own language on paper as it is very easy to forget the details of the agreement months down the road. If you have the document to hand, you can always refresh your memory.
This is very important if you are buying an off plan property when you have a builder’s contract notarized. A builder’s contract should include every detail of the build, from the tiles that will be fitted up to the finish of the roof, and any fixtures or fitting that are included in the price e.g. a fitted kitchen, white goods etc. It should also include clear details of stage payments, when they are to be paid and how much. If you are appointing a person to oversee a new build on your behalf, they will need a power of attorney to do so. (Covered below) You should also include in the power of attorney, details of what the person is being appointed for: if they are to be responsible for handing over payments at the different stages of the build, make it clear in the agreement that the appointed person MUST visit the site and check that the agreed stage has been reached BEFORE making payment.
If you are a couple, married or not, decide whether you are both going to be on the title deeds before drawing up the notarised agreement of sale/purchase. If only one of you is named, only that person will be registered on the deeds, and if you want to change the TAPU to 2 names later, you will have to pay. You will also have to pay to have a name removed, so decide this beforehand. It may help to read up on Turkish Inheritance Law to help you reach a decision; go to www.turkisheconomy.co.uk for plenty of information on this. It’s worth a night of insomnia to get your facts straight.
3. POWER OF ATTORNEY
A power of attorney (P.O.A.) is a legal document which has to be notarized at the notary office. It gives the person appointed the right to act on behalf of the person appointing them, and should be worded so that it reflects the scope of what that person is allowed to do on their behalf.
For example, if you want to appoint a solicitor to look after your purchase or off plan build while you are in your home country, the P.O.A should state their name, company name if applicable, give details of their actions on your behalf i.e. “I appoint x to oversee the construction of my apartment on my behalf, and agree that he/she can hand over stage payments at the named times, if they have checked that the build is going according to the plan” The P.O.A. should also state that the person appointed is only appointed for the duration of the completion of the build/purchase.
Turkish law requires that foreigners buying in Turkey are cleared to purchase by the military, to ensure that properties are not sold to foreigners in militarily sensitive areas. Recent changes to the buying law should make this process much simpler, but since the purchase law was suspended for four months to allow amendments to be made, there will of course be a back log of applications to clear before the TAPU offices catch up with the workload.
Military clearance normally takes up to 3 months, but can take longer depending on backlog, public holidays etc.Your agent or solicitor will regularly check with the TAPU office to see whether your documents are ready to hand over, and then notify you that you can come and collect them.
If your agent/solicitor has P.O.A. they can collect them for you, and you can collect them whenever it is convenient for you to come over to Turkey, if not, whoever is listed as an owner on the title deeds has to come to the TAPU office to sign them, so if you and your wife/husband are both on the deeds, you both have to come and sign.
5. PAYING THE BALANCE
Turkish citizens are able to buy or sell a property in one day, and naturally many Turkish sellers are reluctant to wait 3 months for your military clearance to arrive before receiving the balance of their money. This is not the case with off plan, as you would not pay the final balance until completion of the dwelling anyway, but on a completed new build or resale house, this question can arise.
One way to cope with this is to have a solicitor to act on your behalf, and take possession of the property on your behalf until the TAPU is available, thus ensuring that you get the house you want, but you will have to pay a fee to have the TAPU transferred from your solicitor to you, when your clearance arrives. The best course is to pay the balance on the arrival of the TAPU.
6. THE TAPU
When the TAPU arrives and you go to collect it and sign for it, check the details. The address of the property will be on there, and also, if it is a dwelling, on the left hand side it should say ”ev” which means house or “daire” for apartment. Land is “arsa” so if your TAPU is for a house, make sure it says, house. Some TAPU’s for houses still say “arsa” back from when the property was originally being constructed, and the original owner has not notified the council of the change from “arsa” to “ev” or “daire” and while this is still acceptable, it is still better that the TAPU accurately reflects what you are buying.
Some sellers will ask you to declare a lower price on your title deed than you are actually paying. It is illegal to do this, and can cause major problems and expense in the future, as the tax office can – and will – fine you for under declaration. Every year, every house owner in Turkey pays a property tax, and this is calculated from the amount of purchase stated on your TAPU. If you under declare your purchase price and this is discovered, you will have to pay all of the back tax for the full amount, plus interest.
Also, if you under declare a property, when you come to sell, the amount of capital gains tax you pay (for sales within 5 years of purchase currently) is calculated on the difference between the amount stated on the TAPU and the amount you are selling for. Thus, if you have under declared, the difference between the TAPU price and the sale price to your buyer will be much greater, and will cost you more tax.
For more information on all of this, visit the www.turkisheconomy.co.uk site, or speak to a Turkish solicitor.
This guide is only to be used for general information, please don’t use it as your only guide. Seek proper legal advice for any queries and questions, and don’t make any decisions on purchasing purely on the basis of what is written in this article.
Finally, we have bought and sold two houses in Turkey, and on both occasions have had no problems at all. On both occasions we used the services of agents, and on both occasions they were superb, and helped us with a lot more than just the purchases and sales. There are very good, professional and reputable agents here all of whom will happily share with you all of the above information, as all the good agents know that a happy customer brings more happy customers, so never be afraid to ask a question, and hapy house hunting!