Turkey
Why buy property in Turkey?
Turkey has a truly stunning coastline, great weather, fabulous food and the high standard of service that British buyers have come to expect from a second home destination. A wide choice of property, both new-build and resale, is available – and at a very affordable price compared to other, more established, European destinations.
The cost of living in Turkey is also very reasonable – perhaps 30 to 50 per cent cheaper than the UK. All in all, Turkey has a great deal to offer the British property buyer – be it for investment, retirement or just a holiday home.
Popular buying locations
People looking to buy a property in Turkey tend to look in three main areas: Istanbul, the Aegean coast and the Mediterranean coast. While not the capital, Istanbul is the cultural heart of Turkey and offers a cosmopolitan lifestyle. Having said that, not many foreigners tend to buy here compared to the coastal resorts, but it does offer a better buy-to-let opportunity as the population is huge and the city isn’t suffering from the over-supply that is currently affecting the coast.
The Aegean coast comprises Ce?me, Ku?adasi, Altinkum and Bodrum. Meanwhile, the Mediterranean coast ranges from Maramis in the east to Alanya in the west.
The property buying process
When you have chosen the Turkish property you want to buy, a verbal agreement is made. However, the property won’t be taken off the market until you have signed a reservation contract and paid a reservation fee (this is usually around £2,000). Your solicitor will then request a copy of the title deeds (TAPU), and check that the house/apartment has planning permission.
Providing the title and the other searches are successful, you should then open a local bank account and register with the local tax office. Once clearance has been given, both the property buyer and seller sign a final contract, the balance is paid and your title is registered.
Legal issues
The biggest issues facing the Turkish property market are problems securing title and undervaluing (see new-build versus resale). As well as getting your lawyer to check the title thoroughly, also ensure that they examine the location of your property.
Financing property purchases
The easiest, and most cost effective, way to buy property in Turkey is with cash. UK banks do currently not lend on Turkish property, so if you can’t raise the capital in the UK by any other means then your only other option will be to get a Turkish mortgage.
However, in order to be eligible for a Turkish mortgage, you must be resident in Turkey. All Turkish mortgages are arranged on a repayment basis – there is no such thing as an interest-only loan. You will also need a 30 per cent deposit, as the maximum loan-to-value lent by Turkish banks in 70 per cent.
Turkish property: Fees and taxes
When buying property in Turkey, allow roughly ten per cent of the purchase price for associated costs. This breaks down into estate agents fees of around three per cent, stamp duty of 1.5 per cent and legal fees of up to five per cent. If you are buying from anot
her individual, you may also be liable for property transfer tax at 1.5 per cent. In addition, you must budget for land registration fees, notary fees and any translation services.
There is also an annual property tax and local environmental tax. Bear in mind that if you are planning to rent your property out you will have to pay income tax on any profits.
If you are selling a Turkish property that you have owned for less than five years then you will be liable for capital gains tax. If, however, you sell it after this period then you will be exempt.
Visas, residency and work permits
British citizens need a visa to enter Turkey. If you wish to work in Turkey, your employer will have to apply for a work permit which can be a lengthy process.
New-build versus resale properties in Turkey
There is a great deal of new-build property in Turkey, from one-bedroom apartments to six-bedroom villas. It is important that you buy off a reputable developer, as estate agents are a dime a dozen in Turkey, and there are many horror stories of people buying a property that has also been sold to someone else. There are enough good firms around though, and buying off plan may enable you to secure a home at a competitive price.
If you are buying a resale property, get an independent lawyer to check out the title deeds before signing anything – or handing over a deposit. Also, make sure that the agreed price is mentioned in all official documentation, as sellers may try to list a lower selling price to avoid tax.
Property in Turkey: Investment potential
Buying in any country purely for investment always comes with its risks, and Turkey is certainly no exception. 
The prospect of Turkey joining the European Union is an issue which always arises when discussing Turkish investment potential. The other factor affecting house prices is flights. Turkey is not on any cheap air routes, and currently there are no direct flights to southern Turkey during the winter.
Health and education
Much like in the UK, the Turkish education system is divided into preschool, primary and secondary schools. British children are entitled to enter the state system, but facilities do tend to be much better at either international or private schools. Unfortunately, international schools can only be found in large cities. A child entering the Turkish education system will need a student visa unless they are the legal dependent of someone with a work visa.
Transport
British Airways and Turkish Airlines are among a number of carriers that offer direct flights to Turkey’s major airports on a frequent basis. During the summer months several charter airlines such as Cosmos and Thomas Cook Airlines fly to the southern tourist destinations, but these tend to be limited to fixed term return dates.
Once in Turkey, be aware that public transport is pretty thin on the ground – although there are more buses in busy tourist resorts than elsewhere. Taxi’s however tend to be reasonably priced and in plentiful supply.
And finally…
As with any property investment you should think clearly before investing in a Turkish home. Is the property built to earthquake specifications? Is the estate agent registered?
Ultimately, do your research before committing to any property purchase.