Buyers Guide - Turkey
Why Buy in Turkey?
Until recently it was not possible to take out a mortgage on a property in Turkey. More recently, many banks are willing to offer financial options including HSBC, which offers a maximum of 75% LTAV (loan to appraisal value). If you keep the property for 4 years or more you will not be liable to pay CGT (Capital Gains Tax). However, even if you sell before this time the CGT rate is only 20%.
Fees and taxes
- Allow roughly 10% of the value of the property to cover all costs.
- Agent fees are approx. 3%. Legal fees can vary depending on how straightforward the process will be (budget 5%)
- Stamp Duty is approx 1.5% as well as local annual taxes of around 0.6%.
- On top of this there will also be land registration feeds, Notary fees and translation charges for all offical documents.
- It is compulsary to take out earthquake insurance as soon as possible after completion due to the frequency of these.
The Buying Process
When a property has been chosen, a verbal agreement is made between the buyer and the seller, at this point a small reservation deposit may be required. The buyer should request a copy of the title deeds (tapu), and then a number of the necessary checks are carried out on the property.
The contract is then drawn up, given details of the completion date, along with any other terms and conditions applicable. Once this has been signed by both parties, the deposit of approx. 10% is then paid.
The buyer will then apply for a security clearance allowing them to own property in Turkey. Proof of the buyers identification along with a copy of the current deads are sent to the Tapu office as this point. This verifies the buyers background and ensures the property is not in a prohibited zone.
When clearance has been given, both parties sign a final contract and the outstanding balance is paid with any remaining fees and taxes. the buyer can then register the title transfer.
If buying off-plan, it is normal for a small holding deposit to be paid, followed by a 30% deposit shortly afterwards. For the remainder of the balance, most developers may allow 'staged' payments but this will vary from developer to developer.
Health
Private health insurance is absolutely necessary as there is no reciprocal agreement between Turkey and the UK with regard to treatments.
Property Costs
1 Bed Apartment - £46,000
2 Bed Apartment - £70,000
3 Bed Villa - £110,000
4 Bed Villa - £140,000
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