In the spring of this year, the Turkish government changed the procedure for transactions in the real estate market. Innovations concern foreign citizens who want to purchase housing in the country. These terms of purchase and sale of real estate have nuances that are useful to know before the procedure of the transaction.
New rules of purchase and sale of real estate: an overview of the main points
All changes are fixed in the official document, circular No. 1795. First of all, the new rules relate to the procedure for obtaining an expert assessment of the real estate object that the foreigner intends to purchase or sell in Turkey.
The purpose of the innovations is to improve the processes in the real estate market and bring them to international standards. In addition, the rules will streamline the information and get accurate data on each transaction, as well as make a transparent tax mechanism and increase revenues to the budget.
Prior to the new rules in Turkey, the property ownership document indicated the value of the real estate object below the actual value, and accordingly, the tax applicable to the purchase was less than necessary. This is not possible in the new procedure. Now when buying a property in Turkey, a foreigner is given an expert opinion, in which the real value of the real estate object is fixed. And the tax for registration of rights on the property is calculated on the basis of this figure. The tax amounts to 4% of the total cost of housing.
In addition, the innovations affected developers and owners of the real estate objects from the secondary fund, in whose ownership the apartments from 5 years. Now they have to pay a 20% income tax. The amount is calculated from the difference in the original cost of housing and the price of its sale.
According to the law of Turkey, this tax should pay only those who own real estate of not more than 5 years, and then they are exempt from it.
The rules protect foreign buyers from being deceived by a seller or realtor. Now the buyer is able to read the truthful information about the real estate object in the expert’s report. The real estate object is evaluated by companies that have passed special licensing. The conclusion from the expert is paid, its value affects the area where the housing and its cost established by local authorities. The national average that you need to pay for the document is 1 thousand lira, including VAT. While Turkish law does not say which party pays for the examination, but in most cases, such costs are borne by the buyer. The document is valid for 3 months and contains important data
● cadastral real information about the plot, where the housing is located;
● the land area on the real estate object;
● the type of the real estate object;
● the cost of housing and other information.
It should be understood that new rules of purchase and sale of real estate in Turkey will cause an increase in prices on the market, so the purchase of housing should be considered now.