Turkey 🇹🇷
Capitalize on Turkey's growing economy and strategic location.
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Overview
Capitalize on Turkey's growing economy and strategic location.
Laws & Regulations
- Foreigners can purchase property with some restrictions
- Reciprocity principle applies for some nationalities
- Annual property tax is relatively low
Investment Programs
- Citizenship by investment program (minimum $250,000)
- Residence permit through property purchase
Resident
stamp Duty
Purchase tax (Tapu Harcı) is payable on property purchases:
Rates:
- All property purchases: 4% of purchase price or assessed value (whichever is higher)
property Tax
Annual property tax (Emlak Vergisi) is paid by the property owner:
Rates:
0.1% of cadastral value for residential properties, 0.2% for commercial properties
capital Gains Tax
Capital gains tax on property sales:
Rates:
- Owned less than 5 years: 15% to 35% depending on profit
- Owned 5 years or more: 0%
rental Income Tax
Tax on rental income from property:
Rates:
- Progressive scale: 15% to 35% depending on income amount
Non-Resident
stamp Duty
Non-residents pay the same purchase tax as residents:
Additional Rate: 4% of purchase price or assessed value (whichever is higher)
property Tax
Non-residents are subject to the same annual property tax as residents:
Rates: 0.1% of cadastral value for residential properties, 0.2% for commercial properties
capital Gains Tax
Non-residents pay the same capital gains tax on property sales:
Rates: 15% to 35% if owned less than 5 years, 0% if owned 5 years or more
Reporting Period: Must be reported in the annual tax return
rental Income Tax
Non-residents pay tax on rental income at the same rates as residents:
Rates: Progressive scale from 15% to 35%
Additional Requirements: Must comply with Turkish tax obligations and declare rental income
Mortgage conditions in Turkey:
Average Rates:
2 Year Fixed: 1.5% to 2.5% for residents, 2.0% to 3.0% for non-residents
5 Year Fixed: 1.5% to 2.5% for residents, 2.0% to 3.0% for non-residents
Deposit:
20% to 30% for residents, 30% to 40% for non-residents
Title Issues
Thorough property rights and debt checks are crucial. Failure to do so may result in ownership disputes.
Estimated Cost: €500 to €2,000 for legal verification
Hidden Defects
Non-residents may face restrictions on property purchases in certain regions. Verify rules in the specific area of interest.
Inspection Cost: Additional legal consulting for non-residents may cost up to €2,000
Squatter issues can lead to lengthy legal proceedings, taking several months. Non-residents may face additional complications due to absence.
Estimated Legal Costs: €1,000 to €5,000
Resident
interest Rates
Mortgage interest rates for Turkish tax residents range from 1.5% to 3.5% per annum. Rates may vary depending on economic conditions and the type of mortgage product.
Range: 1.5% to 3.5%
Source: Central Bank of the Republic of Turkey - Interest Rates
down Payment
Minimum down payment for residents ranges from 10% to 20% of the property value. Some banks may offer financing up to 80% of the appraised value.
Range: 10% to 20%
Source: Ziraat Bank - Mortgage Products
mortgage Term
Standard mortgage term for residents typically ranges from 10 to 30 years. Shorter terms may lead to lower total interest payments but require higher monthly installments.
Range: 10 to 30 years
Source: VakifBank - Mortgage Options
documentation
Required documents include ID, tax returns, proof of income, and property documents. Incorrect information may lead to loan rejection.
Source: Turkish Ministry of Finance - Mortgage Requirements
casestudy
In 2022, a Turkish tax resident faced issues due to insufficient property rights verification, resulting in mortgage rejection and losses of €5,000 in preliminary expenses. This highlights the importance of thorough preparation and professional assistance.
Source: Turkey Property - Common Mortgage Issues
Non-Resident
interest Rates
Non-residents in Turkey can expect mortgage interest rates from 2.5% to 4.5% per annum. Higher rates are due to increased risks for banks when lending to non-residents.
Range: 2.5% to 4.5%
Source: Ä°ÅŸbank - Mortgages for Non-Residents
down Payment
Down payment for non-residents typically ranges from 20% to 50% of the property value. Many banks offer financing only up to 50% of the appraised value.
Range: 20% to 50%
Source: Garanti Bank - Non-Resident Mortgages
taxation
Non-residents should be aware that when selling property in Turkey, they are required to pay capital gains tax, which is 15% on capital gains. It's also important to consider tax obligations in their country of residence.
Source: Turkish Revenue Administration - Capital Gains Tax
mortgage Term
Mortgage term for non-residents typically ranges from 10 to 25 years. Shorter terms can help reduce total payments but require higher monthly installments.
Range: 10 to 25 years
Source: Yapı Kredi - Mortgages for Foreign Buyers
casestudy
In 2023, a non-resident faced issues due to inaccurate property ownership information, leading to mortgage process delays costing €10,000 and additional legal fees. This emphasizes the importance of professional assistance when applying for a mortgage.
Source: Turkey Property - Challenges for Foreign Buyers
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