Everything you need to know is included in our Turkey Property Pack
Turkey's real estate market is gaining attention from foreigners due to its beautiful landscapes, affordability, and strategic location.
Navigating the local property market can be a bit of a puzzle though, especially for non-residents. There are several hurdles and surprises that you should be ready for.
Our group of property buyers and local associates have voiced multiple issues to us. We've listed them all in our Turkey Property Pack.
We’re going to take a closer look at a few of these in this article.
Is it safe or risky to invest in real estate in Turkey?
Generally, buying property in Turkey is considered safe. However, as with any country, scams exist.
One common scam involves agents selling properties that they don't have the legal right to sell, leading to multiple people buying the same property. It's crucial for potential buyers to ensure they're dealing with reputable agents and verify property ownership through the Tapu (land registry office) before making a purchase.
Turkey's real estate market is known for rapid appreciation in some areas and stagnation in others. Foreigners often make the mistake of purchasing properties in locations that don't yield the anticipated return on investment.
For instance, while Istanbul's prime areas can be lucrative, some suburbs may not offer the same promise due to oversupply.
Foreigners, especially those who don't speak Turkish, can sometimes face challenges in fully understanding contracts, which can lead to disputes or unintended obligations.
Furthermore, some regions in Turkey have restrictions on foreign ownership, primarily for strategic or military reasons.
Turkish laws do provide protections for property buyers. The property buying process is relatively transparent, especially compared to some neighbouring countries.
However, it's worth nothing that Turkey's regulations and bureaucracy can be complex. For instance, properties within certain distances from the coast or military zones require additional checks and approvals for foreign buyers.
While the legal system in Turkey is functional, property disputes can be prolonged. It's essential to have a good lawyer who understands the intricacies of Turkish real estate laws. That said, Turkey has been making efforts to align its legal framework with European standards, improving both efficiency and fairness in such matters.
Foreign buyers should conduct comprehensive due diligence. This includes verifying property titles, ensuring there are no outstanding debts on the property, and checking the zoning regulations.
It's also wise to understand the local property market trends and get a property valuation.
Buying real estate in Turkey can be risky
An increasing number of foreign investors are showing interest in Turkey. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
Potential real estate buying mistakes in Turkey
"İmar Barışı" or zoning peace
When buying residential property in Turkey, a common and unique pitfall you need to be aware of involves the "İmar Barışı" or "Zoning Peace".
This is a Turkish regulation related to unauthorized or non-compliant building works. In some cases, properties, especially in coastal areas or smaller towns, may have been constructed or modified without proper adherence to building regulations or zoning laws.
When scoping out seemingly ideal properties, be mindful of the possibility of unauthorized extensions or alterations.
In Turkey, this scenario is frequently encountered, particularly in locales characterized by hasty or informal development. The crux of the issue lies in these properties potentially falling outside the purview of the İmar Barışı regulation.
Non-compliance can result in a myriad of legal entanglements, monetary penalties, or in extreme cases, demolition mandates down the line.
To avoid this pitfall, you should always verify the property's compliance with local zoning laws and ensure that any modifications or constructions are officially documented and approved. You can do this by consulting with a local lawyer or a real estate expert who is familiar with the specific regulations in the area where you're looking to buy.
It's also advisable to check the property's 'İmar Durumu' (zoning status) and 'Yapı Kullanma İzni' (building occupation permit) to ensure everything is in order.
The concept of "Tapu"
Another specific pitfall in buying residential property in Turkey, particularly relevant for foreigners, involves the "Tapu" and military clearance.
The "Tapu" is the official deed for property ownership in Turkey. For foreign buyers, it's crucial to know that certain areas in Turkey are restricted for foreign ownership due to their proximity to military zones or strategic importance. This is a unique aspect of Turkish property law.
In this context, when you find a property you are interested in, you should first check if it's located in a military zone or near one.
Properties in such areas require military clearance before the sale can proceed. This process involves ensuring that the property doesn't fall within a restricted zone and can be quite time-consuming, sometimes taking several months.
The frequency of this issue varies based on location. It's more common in areas close to borders, coastal regions, and certain rural areas with military significance. In major cities or established residential areas, it's less of a concern.
To avoid this pitfall, you should conduct due diligence before proceeding with the purchase. Work with a local lawyer or a real estate agent who understands the intricacies of Turkish property law and can help you navigate the process.
They can check the status of the property with respect to military zones and assist in obtaining the necessary clearances.
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The issue of "Gecekondu"
A unique pitfall you should be aware of when buying residential property in Turkey involves the issue of "Gecekondu" areas. "Gecekondu" literally translates to "built overnight" and refers to areas where buildings are constructed rapidly and often without proper planning or authorization.
These are usually informal settlements that have sprung up, and they present a specific set of challenges.
In the context of buying property, if you're not familiar with the local area, you might inadvertently purchase a property in a Gecekondu area. These properties can be risky investments due to several reasons, first of them being that they may lack legal documentation, may not be built to safety standards, and can be subject to government demolition or urban renewal projects.
Additionally, obtaining utilities and services in these areas can be challenging.
This issue is more frequent in suburban areas or outskirts of larger cities like Istanbul or Ankara, where rapid urbanization has occurred. In such areas, the delineation between formal and informal housing can sometimes be blurred.
To avoid this pitfall, you should thoroughly research the area where you plan to buy property.
It's advisable to work with a reputable real estate agent and a lawyer who are well-versed in local property laws and can identify Gecekondu areas.
Always check the property's legal status and ensure that it has all necessary permits and documentation.
Risk in the "DASK" insurance requirement
A less commonly known but significant pitfall in purchasing residential property in Turkey relates to the "DASK" insurance requirement.
DASK, short for Doğal Afet Sigortaları Kurumu, is the compulsory earthquake insurance for properties in Turkey. This is particularly relevant due to Turkey's susceptibility to seismic activity.
The oversight often occurs when you, as a foreign buyer, are not fully aware of the DASK requirement or its implications. While the real estate transaction might go smoothly, the absence of DASK insurance can lead to serious issues in the event of an earthquake.
This insurance is not only a legal requirement but also a crucial protection for your investment.
The frequency of this issue depends on the awareness level of the buyer and the diligence of the parties involved in the transaction.
Some sellers or agents might not emphasize the importance of DASK, leading to unintentional non-compliance.
To circumvent this pitfall, it's essential to first confirm whether the property you're interested in is covered by DASK insurance and if the policy is currently valid. Understanding the specifics of this insurance, including its coverage details, is crucial.
In cases where the property lacks DASK insurance or if the existing policy has expired, it's imperative to secure this insurance prior to completing the purchase.
Ensuring adherence to the DASK insurance requirement is a critical step in safeguarding your investment and staying compliant with Turkish law.
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The concept of "Belediye Encümeni"
An often-overlooked pitfall when buying residential property in Turkey is related to the "Belediye Encümeni" approval for foreign buyers.
The Belediye Encümeni, or Municipal Committee, plays a crucial role in the property purchase process for foreigners.
In some cases, properties located within certain municipal boundaries require additional approval from the local Belediye Encümeni before the sale can be finalized to a foreign national.
This step is distinct from the general military clearance and other standard legal procedures. The requirement for this approval can be specific to certain areas and is not uniformly applied across all regions in Turkey.
The pitfall lies in assuming that once you have passed the military clearance and other standard legal checks, the purchase process is complete.
However, overlooking the need for Belediye Encümeni approval can lead to delays, additional administrative hurdles, or in some cases, the annulment of the sale process.
The issues associated with "Miras" or inheritance laws
Another nuanced pitfall in the Turkish property market, particularly relevant for foreign buyers, is related to the inheritance laws and their impact on property ownership.
In Turkey, inheritance laws are quite different from those in many Western countries and can have unexpected implications on property bought in Turkey.
The key issue arises with the concept of "Miras" (inheritance).
In Turkey, when a property owner passes away, their property is automatically inherited by their legal heirs, which may include a wide range of family members, not just the spouse or children. This can lead to a situation where a property you buy or invest in becomes part of a complex inheritance scenario, involving multiple parties with legal claims to the property.
This aspect is often overlooked by foreign investors who are not familiar with Turkish family and inheritance laws. It becomes particularly complex in cases where the property owner has a large family, or where there are disputes among the heirs.
To navigate this potential pitfall, you should gain a clear understanding of Turkish inheritance laws and how they might affect your property in the event of the owner's death.
Next, you should consider setting up a clear will or legal arrangement in Turkey that aligns with your intentions for the property.
Engaging with a local attorney who specializes in Turkish property and inheritance law is crucial to guide you through these complexities.
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The awareness of the "2B Land" issue
A more specific and often overlooked pitfall in the Turkish real estate market is related to the "2B Land" issue.
"2B Lands" are specific types of land in Turkey that were originally classified as forest land but later reclassified for potential development or sale. These lands have a unique legal status and come with specific considerations and risks.
The issue arises when you, as a foreign buyer, unknowingly purchase a property situated on 2B land.
Such lands might have been reclassified and sold without proper legal procedures, leading to potential disputes or legal challenges in the future. The ownership of 2B land can be contentious, and there may be restrictions on what can be built or how the land can be used.
This problem is particularly prevalent in areas where rapid urbanization and development are occurring, often in coastal regions or outskirts of major cities.
The allure of these lands is often their lower price compared to standard properties.
However, the legal uncertainties and potential for future disputes can make them a risky investment.
"Imar Planı" or urban planning scheme changes
A particularly intricate pitfall in the Turkish real estate market involves the concept of "Imar Planı" (Urban Planning Scheme) changes.
The Imar Planı dictates how land can be used, including zoning laws, building regulations, and development plans.
These plans are subject to change, which can significantly impact property values and development potential. The issue arises when you purchase a property with certain development expectations based on the current Imar Planı, only to find that the plan changes after your purchase.
For instance, you might buy a property intending to develop it into a residential complex, but a change in the urban plan could suddenly restrict the area to agricultural use only.
Conversely, you might purchase a property in a quiet area, which later becomes zoned for commercial use, impacting its tranquility and possibly its value.
This pitfall is more prevalent in rapidly developing areas or in locations undergoing significant urban transformation.
The Turkish government periodically revises urban plans, and these changes can be hard to predict.
Before finalizing your property purchase, it's crucial to conduct an in-depth investigation of the area's current "Imar Planı" or Urban Planning Scheme. This involves understanding not only the existing zoning laws and building regulations but also being aware of any potential changes that might be under consideration.
Keeping abreast of local government decisions and attending urban planning meetings where such changes are discussed can provide valuable insights into future developments.
Additionally, it's highly advisable to work closely with a local lawyer or real estate consultant.
These professionals should specialize in Turkish property law and have specific knowledge about urban planning trends in the area you're interested in.
Their expertise can be instrumental in helping you navigate and adapt to any changes in the urban planning scheme, thereby safeguarding your investment against unforeseen developments.
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"Güneş Hakkı" or sunlight right
In the Turkish real estate market, a nuanced pitfall involves the concept of "Güneş Hakkı" or "Sunlight Right".
This is a legal provision that protects a property's right to sunlight and can significantly impact the value and usability of a property. The issue surfaces when a new development, either existing or planned, potentially blocks the sunlight to your property.
For instance, you might purchase an apartment with ample natural light, only to find later that a new construction project nearby is approved, which would obstruct the sunlight reaching your property.
This not only affects your living experience but can also reduce the property's value.
The challenge is more pronounced in densely populated urban areas like Istanbul, where high-rise developments are common.
To navigate this potential issue, it's important to research any planned developments in the vicinity of the property you're considering.
Consulting with local authorities or a knowledgeable real estate agent can provide insights into future construction projects. Additionally, understanding local laws and regulations regarding Sunlight Right and how they are applied in the area of your interest is crucial.
This proactive approach can help you avoid investing in a property that might lose its appeal and value due to compromised natural light.
"Kentsel Dönüşüm" or urban transformation
Another subtle but important pitfall in Turkish real estate, particularly for foreign investors, is the issue of "Kentsel Dönüşüm" or "Urban Transformation".
This is a government initiative aimed at renewing areas that are deemed unsafe or outdated. While this can lead to improved infrastructure and living conditions, it can also have unexpected consequences for property owners.
The challenge arises when you purchase a property without realizing it falls within an area designated for urban transformation.
In such cases, your property might be subject to compulsory purchase, redevelopment, or demolition by the government. This can happen with little warning, and compensation offered may not always align with market values or your investment expectations.
This issue is particularly relevant in older neighborhoods or in areas prone to earthquakes, where the government is actively seeking to upgrade buildings to modern safety standards. The uncertainty surrounding the timing and specifics of these projects can be a significant risk factor.
To mitigate the risk of the "Kentsel Dönüşüm" or "Urban Transformation" in Turkish real estate, it's essential to first thoroughly investigate if the property you are interested in is located in a zone designated for urban transformation. This crucial information can typically be obtained through inquiries at local municipal offices or by consulting a local real estate expert who is familiar with the area's development plans.
It's also important to understand the full implications of Kentsel Dönüşüm, which includes potential timelines for redevelopment, the mechanisms for compensation, and your rights as a property owner in such scenarios.
Lastly, consider the long-term prospects of your investment, especially if the property is situated in an area earmarked for future urban transformation.
This forward-looking approach can help you avoid unexpected disruptions and ensure that your investment aligns with your financial goals and expectations for property ownership in Turkey.
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