Costs of Buying Property in Turkey

Costs to Consider When Buying Property in Turkey

When purchasing property in Turkey, several costs accompany the purchase price. These include legal fees, taxes, a buyer’s fee, and miscellaneous administrative costs. Here's a comprehensive guide to help you navigate these expenses:

Legal Fees

Your first cost to consider is legal fees. The average rates for a real estate lawyer in Turkey range from $1400 to $2000. Their services ensure your purchase is secure, including checking the title deed (TAPU) for any encumbrances like debt and verifying all relevant information. This safeguard is crucial for your investment. After obtaining your tax number and notarizing and translating your passport, you may need to pay a small deposit for the property. The lawyer will also draw up the contract between the buyer and seller, detailing the payment schedule and completion date.

Stamp Duty

Stamp Duty is a one-time fee payable upon the registration of the title deeds. This amount is 4% of the assessed/declared value of the property. Typically, the buyer pays this fee, although sometimes it is split with the seller. The assessed value is generally 50-60% of the market price. Additionally, a Value Added Tax (VAT) of 18% on the sales price is required by Turkish law. However, there are exceptions. First-time foreign purchasers who have lived abroad for more than six months will not pay the 18% VAT on their first purchase in Turkey, provided they meet specific conditions. Most newer properties under 149 square meters are subject to a standard VAT rate of 1%.

Agency Commission Fee

An agency commission fee of 3% of the property cost is payable upon signing the property purchase contract. Be cautious of any deviation from this standard 3% fee, as it may indicate fraudulent behavior.

Other Costs

Miscellaneous costs, such as notarization of paperwork and small local fees, will add to your overall expenses. Services in Turkey are relatively low-priced compared to other countries, usually totaling around $600 or less.

Estimated Annual Costs of Property Ownership in Turkey

Investing in Turkey is lucrative, with high property value growth rates and affordability compared to Europe and the USA. However, it's essential to be aware of ongoing costs. Here are three annual expenses you can expect:

Taxes

Taxes are the highest annual cost, although the rates are low compared to other countries. Residential properties are taxed at 0.1% of their value in small cities and 0.2% in large cities like Istanbul. This tax must be paid by the end of May each year.

Aidet

The aidet is a maintenance fee for some apartment buildings, condos, and housing complexes. This monthly fee varies based on the resident’s needs and the quality of service received. Luxury buildings have higher fees, while those with basic services may only charge a small fee for cleaning shared spaces.

Home Insurance Policies

Home insurance policies are reasonably priced in Turkey. Turkish law requires an up-to-date earthquake/Natural Disaster Assurance insurance policy (DASK), which must be renewed annually. Home contents insurance and property insurance policies are also advisable to cover any loss due to unpredictable events. It’s worth obtaining several quotes from brokers to find the best rates.