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Friday, 02 January 2009 00:00

Basic Steps, Property Sales

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Double checking the property

Once the sale and purchase conditions are agreed with the owner or with his/her agent, you are advised to ask for a copy of the TAPU (Title Deeds) and double check whether:

  • The TAPU really belongs to the property you are interested in

  • It is a residential or commercial property in a zone covered by an Implementary Development Plan or a Local Development Plan (If not, please note that the new Title Deeds law does not allow you to buy it, please give up buying it)

  • The property really belongs to the person who introduced himself to you as the ‘owner’ (Compare the ID card of the person to the TAPU of the property)

  • A joint ownership is in question (if so, whether all of the shareholders comply with the sale)

  • No annotation prohibiting the sale/purchase of the property appears on the TAPU (Unless the prerequisites envisaged by the annotation are met, the sale is impossible).

  • The Implementary Development Plan (Imar Plani) or the Local Development Plan allows you to erect a building on the land (if a land is in question and you want to construct a building on it),

  • The building complies with all regulations such as earthquake-proof standards (if you are about to buy a flat or house, you should check all licenses and official permits for the property had been properly obtained),

  • The current owner(s) owes no over-due taxes to the Tax Office,

  • The current owner(s) owes no over-due debts to the utility companies,

  • The agent you are using, if any, works for a registered company,

  • The solicitor you are using, if any, is an authorised solicitor,

  • A binding contract with a tenant using the property is in question.

Moreover, in order to save time and not to be in a hurry later, you should;

  • Register with a local tax office and then open a bank account,

  • Make necessary contacts with the relevant professionals such as a good solicitor, a Sworn-Translator, an independent accountant or an agent.

Preparing a draft contract

Although these contracts are not compulsory according to current regulations and mutual declaration of both the buyer and seller to the TAPU (Title Deeds) Registry Office is enough to carry out the transfer of ownership, having a robust sales & acquisition contract will allow you to protect yourself from some potential risks which may stem from the seller or agents.

If you are using a real estate agent and/or solicitor, please ensure the contract refers to her/him and she/he also signs the contract.

Please make sure that a contract should, at least, include the following:

  • A detailed description of the property (address, TAPU details, technical conditions etc),

  • The actual price to be paid to the seller for the property (Please note that when the contract includes any “price” clause, then each of both you and the seller are to pay a Stamp Duty of 0.75% of the value stated in it. However, mentioning the actual price will allow you to secure your all rights in case of a future legal dispute),

  • The details on the bank account of the seller (It should be a single account into which all payments to the seller should be made),

  • The details of the bank account of the professional you use, if any (you should use a single account for all payments to be made to this professional),

  • The payment terms and conditions (payments to the seller including deposit, interim and final payments, and payments to an agent/solicitor, if any, ought to be separately identified),

  • A Statement emphasising that the seller and the buyer will pay their own tax liabilities (some sellers may force you to pay all taxes including theirs with regards to the sale of the property),

  • The fees and commissions to be paid to the solicitor or agent (this will secure you in a way that you will not be involved in a tax evasion which may be caused by those professionals. Furthermore, this will prevent those professionals from making unfair money)

  • Under what conditions and how the money paid by the buyer will be refunded by the seller,

  • Force majeure conditions (For example, what if a legal obstacle occurs in the future),

  • How current tenants, if any, will be treated,

  • How over-due debts, if any, of the current owner, which are property-related, will be treated,

  • How existing furniture, if any, will be handled

  • Whether parties can give up the sale/purchase, if so, under what conditions this can happen,

  • How to keep the parties regularly informed about the on-going transactions at the local TAPU office,

  • How a power of attorney, if any, will be cancelled or amended, how other parties will be kept informed about this,

  • Detailed permanent contact information of the signature holders,

  • What if one of the parties breaches the promises written down, who will decide under what conditions that a breach was realised,

  • How future disputes will be sorted out,

  • The rights and responsibilities of the persons whose signatures appear on the contract,

  • ID numbers of Turkish nationals (TC Kimlik No) who are to sign the contract, the Barr registry number of the solicitor being used and the trade registry number of the real estate company.

Having the draft contract translated

Before signing the contract, you ought to have it translated into English. In other words, you are advised to have both English and Turkish versions of the contract. You are strongly advised to use a Sworn-Translator if you do not use an English-speaking solicitor. Sworn-translators’ fees are quite appropriate.

Please note that relying on only an oral-translation may lead to unwanted situations in the future.

Instead of preparing two separate contracts in Turkish and English, having a bi-lingual contract may be of great use.

Having the contracts notarised

You are strongly advised to sign both the English and Turkish versions of the contract (or a bi-lingual contract) in the presence of a notary public and then have them notarised. This will ensure that

  • the people signed the contract and their signatures are genuine,
  • the contract is in line with Turkish laws and officially acceptable anywhere in Turkey,
  • the terms within the contract are binding for all parties.

Payment terms of the contract

To take off the asset from the market, you may pay a deposit which is negotiable between the seller and you. In some situations, interim payments may be required.

Please note that real estate purchase deposits are averaged at 5-to-10% of the selling price. Interim payments should be as minimal as possible.

Real estate commissions may be charged on both the seller and you. For some cases, only one party may pay the commission. Total commission rate is around 3%.

Application to the TAPU Office

As a next step, both buyer and owner (or their legally authorised agents) apply to the TAPU Office for transferring the ownership.

Documents asked by the TAPU Office

Individuals

During the application, the buyers (individuals) are to provide the local TAPU Office with the following documents:

i. Title Deed or a document indicating the property’s exact location (plot or parcel number etc.)
ii. Passport and/or ID Card of the buyer,
iii. Two recent passport photos of the buyer, sized 4cm x 6cm
iv. If any agent is being used;

  • Passport and/or ID Card of the agent
  • Two recent passport photos of the agent and
  • An acceptable Power of Attorney.

FDI companies (companies established in Turkey)

Companies established in Turkey in line with the Foreign Direct Investment Law have to issue an authorisation document to be prepared by the Commercial Registry Office on behalf of them. This document basically covers the

  • name/title of the company,
  • the names of the authorized representatives, and
  • whether the type/legal features of business allow the property purchase.

Companies established abroad

Commercial companies established in countries with which reciprocity exists have to submit an officially ratified authorisation document similar to the document described in the above sub-section. If any power of attorney is to take place, then two recent passport photos of the agent and an acceptable Power of Attorney are required.

Please note that The Turkish-British Chamber of Commerce and Industry (www.tbcci.org) can help you prepare all commercial documents and you can have the necessary documents ratified at the Turkish Consulate General in London.

For further information, you can contact the Directorate General of TAPU through

Address: TAPU ve Kadastro Genel Müdürlügü
Dikmen Ankara/Turkey
Tel: +90-312-413 60 00 (pbx), 413 61 01, 413 61 02, 413 61 03, 413 61 04 (direct)
Fax: +90-312-413 61 05, 413 61 13, 413 61 25
Web: www.tkgm.gov.tr
E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.This email address is being protected from spambots. You need JavaScript enabled to view it.%20">

How are FDI and foreign companies treated by TAPU Offices?

FDI Companies

Legal entities (companies) established or participated in Turkey by foreign investors can acquire real estate or limited rights in rem in Turkey in line with operational purposes set in company's Articles of Association.

Foreign Companies

Foreign real persons and trading companies having legal personality established in foreign countries according to the laws of these countries can acquire real estate in Turkey on the conditions of being reciprocal and complying with legal restrictions. In implementation of reciprocity principle, it is essential that real estate acquisition rights given by a foreign country to its own citizens and to trading companies established in foreign countries according to the laws of these countries, are also given to the citizens and trading companies of the Republic of Turkey.

The real property purchase application of such company to local Land Registry Offices is forwarded to General Directorate of TAPU (The Land Registry and Cadastre Office) for reciprocity control. General Directorate double checks the application from the Ministry of Foreign Affairs as the existence of reciprocity between our country and a foreign country in terms of trading companies, is determined by Ministry of Foreign Affairs.

After the reciprocity confirmation of aforementioned Ministry and response of the military post stating the subject real estate is out of military forbidden zones and security zones the company then becomes eligible for buying the property.

Trading companies having legal personality established in foreign countries according to the laws of these countries have to submit an officially stamped authorization document during the registration.

Foreign commercial companies which are legal entities can buy property provided that they operate pursuant to the special laws such as the Tourism Encouragement Law, the Oil/Petroleum Law, the Industrial Zones Law, etc. In addition, foreign legal entities other than the above mentioned commercial companies, such as foreign charities, foreign foundations and foreign societies, etc. cannot buy property in Turkey.

For more information please visit

www.tkgm.gov.tr

Issuance of a new TAPU by the Office

Finally, after military clearance has been finished, you are given an official ownership document called the Title Deeds (TAPU).

Without having a TAPU, you are never considered to legally own the property even if you signed a legally acceptable purchase contract with seller.

You are advised to make the payments net of the deposit (plus interim payments, if any) to the seller at his stage.

Declaration of acquisition to the local government

You are supposed to apply to the Municipality for declaring the acquisition of the property by the end of the year of acquisition. You simply fill out a form and submit it to the municipality. Afterwards, the municipality officers will tell you when/how much ‘real estate tax’ (a tax similar to the Council Tax in the UK) you are going to pay.

Read 1331 times Last modified on Sunday, 21 June 2015 19:38