Buying Investment Property in Turkey

While the Turkish property market is fairly straight forward, there are a number of issues which you should be aware of :-

Local Representation

Even though the process for acquiring property in the country is fairly simple, do not be fooled into thinking that you can do it all yourself. As with any foreign market it is imperative that you take local advice and install someone to look after your affairs, ensuring all goes smoothly and more importantly in line with local regulations. Do not forget that by installing a legal representative to act and advise on your behalf you are also covering yourself in the event of problems, with possibly legal recourse in the event of bad advice.

Property Transactions

While mortgages were introduced to Turkish nationals in February 2007, the market is still very much in its infancy and the vast majority of deals are agreed on a cash basis. This involves the payment of a deposit on agreement of a sale, and full payment when all of the paperwork has been completed. Please note that most properties in Turkey are held on a freehold basis.

Ownership Title

When dealing with Turkish property you will come across the term Tapu, which is the British equivalent of the title deeds. This is the ultimate proof of ownership and it is imperative that the information detailed in the Tapu is correct. All property ownership information is registered at the Office of the Conservator of Title Deeds.

Additional Costs

As you would expect with any property transaction there are a number of additional costs which need to be factored into any investment equation. As a ball part figure you should assume an extra 7% of the purchase price for costs. These include property purchase tax, agent fees, legal fees, notary fees as well as the cost of various utility services for the property in question.

Conclusion

Due to the fact that the vast array of Turkish property transactions are completed on a cash basis, the process can often be completed very quickly if both parties are available. However, this looks set to change over the next few years as the mortgage market continues to grow with more and more Turkish nationals expected to use mortgages to fund their future property purchases. Overall the outlook for the Turkish property market is very encouraging with a lack of quality housing in places like Istanbul set to push prices higher, and also encourage new property developments. When you also consider that the relative wealth of many in the country is increasing, and over 60% of the population is under 30 years of age, demand seems set to continue to rise for some time to come.

Sources

Wikipedia - Foreign purchases of real estate in Turkey
Nubricks.com - Property in Turkey