Turkey - still a safe bet

For those planning to throw themselves into the Turkish property market, getting the right legal advice is vital. We talk to real-estate lawyer Sukru Enhos who guides us through the maze of Turkish law.

By Camilla Kaas Stock

Can you tell us a bit about how the buying process works in Turkey?

"First of all you, or your representative, have to go to the local land registry with your passport, or a notarized copy, as well as all the relevant documents. The land registry will then be able to do all the necessary checks, which will take between 2-6 months, depending on how busy things are. When this process is completed, transfer charges need to be paid. With that I mean sale and purchase taxes, which both stand at 1.5%, but in practise the buyer often ends up paying the whole 3%. Then there is stamp duty, which is currently 110 turkish lira. There is also another payment, or donation, which isn't compulsory, and varies from district to district. In our area it is 300 Lira which goes to running costs of the Registry office."

What about VAT on a new build, who pays that?

"VAT is paid by the client, but it will already have been included in the price."

Are there problems with bad developers here, or are things generally good?

"A few years ago you would only get a fine for building illegally, but since the 12th of October 2004, it has become a crime punishable with 1-5 years in prison. Of course there still have been a few cases where developers have built without all the necessary permission, but 99% are all done according to the strict laws. Sometimes a developer might try to construct a bit larger than they are allowed, to maximise profits, but because the government is clamping down on this, it happens much less. The increase in demand for holiday homes, has also led to some people, who are not developers, trying to cash in. So of course there are problems, but it is still very rare."

What about building regulations?

"Building regulations here are very strict and checks are done regularly through the different stages of the building process. When it comes to restrictions, they vary from area to area. In Side, you are only allowed to build three floors at the coast and six floors inland, where as in Alanya, you can build up to 20 floors. This means there is less potential profit to be made here, so Side doesn't attract the big developers. Here you mainly find local developers who follow the rules, otherwise it would be hard for them to do business."

Would you say is it is safe to buy in Turkey?

"Off course I can't say that everything is safe. It is always very important to hire a solicitor, who can do all the checks for you. This goes for buying property anywhere in the world, even in your own country. I also think it is a good idea to use a local solicitor, because that solicitor will know the developers and how they run their business as well as all restrictions in the area. As a solicitor, I am not allowed to tell a client that this developer is bad and this one is good, but if I am aware of a risk I can still stop the sale."

Can you be sure that the lawyer you hire is independent and will look after your interests?

"I hear that question often, because we are such a small circle here and we have been working with most of the developers and estate agents. If there is a conflict of interests, we cannot represent both parties, so if such a situation arises, we advice our client of this. If they still want to use us, then we will only represent them for the purchase transaction, but not in case of conflict. We do receive salaries from some of the developers and this means we won't represent any of their clients, but advice them to find another solicitor. There are very strict rules here and as a lawyer I am not in any way allowed to advertise my services. In the last few years we've gotten a lot of experience with foreign buyers and foreign law, and we are trying to adapt ourselves to their needs."

What are the restrictions on what you can buy as a foreigner?

"Before 2004 foreigners could buy properties in rural areas, but now it is not allowed. This is because within the last 10 years some new municipalities have been established and zoning and planning haven't been completed yet. Also Turkish registration law has been amended several times in the last 5 years and this has resulted in the current situation where foreigners can't buy in these areas.
Also, a foreigner isn't allowed to buy property within a certain distance of a military base, so the local army official will have to give their approval.

"A foreigner is currently allowed to buy 25,000sqm of land. So, you can own for example 5,000sqm in Side and 20,000sqm in Istanbul. This is of course different for a foreign company who can buy a lot more, but there are still some restrictions.
Also I must mention the fact that not all foreigners have the same rights to buy in Turkey. The government operates a policy, whereby for example if a Turkish citizen is allowed to buy property in Norway, then a Norwegian citizen is allowed, in the same way, to buy property in Turkey. This also means that if a Turkish citizen isn't allowed to buy in a country, like for example Romania or Syria, then the same goes for those countries citizens. So basically the same rules go both ways."

How will a future EU membership affect the laws?

"There have already been a lot of changes made to try to adapt to EU laws. Some think that Turkey won't be accepted as a full member. But, even if that is the case, the changes in the laws will make a big difference to the future of our children. Having good relations with all countries, and not just with the European countries, is important for every nation. The Turkish state is quite new and to improve ourselves we need to have peace with all our neighbours," says Sukru.