Buyer Guide
Starting your property investment in Turkey
Whether you are a home buyer to settle in Turkey or are purely an investor, this buyer guide will help you find your way. ‘What you need’ and ‘what to expect’ when you are looking to buy a property in Turkey this Guide will help you.
The system is pretty straight forward when both parties agree a deal. However, as a foreign buyer/investor you may need a few extra steps compared to a local pair.
The Documents You need for purchases
- The translation of your passport as your ID (It is a simple process)
- Your tax number (We will get you one if you have not got one already)
- Valuation report (This is mandatory. The seller’s rep calls a surveyor and it takes 24-48 hours to be delivered)
- Tax value of the property and a no debt document. (We get this from the municipality for you)
- We need a Currency Exchange document from Ziraat Bank. (We will be by your side thorough this) It needs to be equal amount to the declared amount.
The buying process
Once we agree all and pay the mandatory property tax and fees, we will organise a meeting to exchange signatures. The full payment is made on the same day right before the signature has been made. Then in 10 minutes later you will have your title deed.
There are small differences when it comes to buying different type of properties. Good examples are an apartment, and agricultural land or a zoned development land plot.
For instance, if you are buying an agricultural land as a foreign citizen then it needs to be larger than 50.000 sqm. If you are buying a fruit garden, it can be any size, however depending there is a minimum density of trees requirement.
We apply to the Agricultural Administration Centre and determine if the land is eligible for you to buy.
Zoned land plots do not have any limitation! READ MORE ABOUT OUR DEVELOPMENT SERVICES
Of course, there are a few customs when it comes to agreeing a deal. As we are locals, this section is covered when MARE is by your side.
Those customs that you need to know
- Usually, the buyer pays all off the Mandatory 4% property fee prior to the transaction. In some cases, we can agree with the seller to pay 50/50.
- When we see a property and decide to go ahead, we will start the negotiation process. If a price is agreed a 2% VAT deposit is required to book the property.
- After the booking, a withdrawal agreement is signed where the price, payment terms, and the date of transaction appears. If any of the parties withdraws there will be a penalty statement. This happens very rarely.
- In some cases, we will pay the declared amount to the named account of the seller. Then the rest of the agreed amount could be paid in cash.
Setting up a business in Turkey would be rather complicated or at least you would feel unfamiliar with the process. Luckily though, at MARE we cover all aspects of settling in Turkey and that includes starting your business.
All we need is your passport translation, the company name you would like, and the field you will be working in. We do not claim it costs $4.000-5.000 to open a business, like large Istanbul agencies. Depending on the size of the business, registration, trademark etc. we charge from $1.500 to $2.000.
Registration to Chamber of Commerce and other similar entities involve their own fixed fees and annual membership.
Mersin is ideal to bring your business, especially because it hosts the largest International Port on the Mediterranean. Plus, the new international airport(*) will have a Cargo Terminal, which makes your work much easier.
(*) The Cukurova Regional Airport will be opened on 15.01.2024
The History of gaining Turkish Citizenship
Foreign investors have been buying property Turkey for many years. Citizenship was only given to who has lived in Turkey for at least five years.
The introduction of citizenship via investment in property saw the amount of $1.000.000 first. Was this a strategy or miscalculation, this is unknown. However, when the amount was reduced to $250.000 the seal was broken. Then, hundreds of families so far have become Turkish citizens in about 6 months after they received their title deeds and made their application.
The current minimum amount to invest is $400.000. It covers the father, mother, and their children under 18 on the day of the application.
The way you can get Citizenship – An example
Citizenship can be gained by buying residential homes, commercial units such as shops or offices. Even zoned development lands or agricultural lands are accepted.
Ideal purchase is where the seller accepts to declare the property in full. Of course the price you buy the property should be correct. Because the valuation surveyors are independent, and all three criteria must be met for you to qualify for citizenship. Let us list the criteria with two properties you will buy to apply for Turkish Citizenship.
- First property is an apartment which we will pay 6.500.000 TL for. On 20.12.2023 USD was 29.05 TL which makes this amount $223.750. Declared amount was 6.500.000 TL
- The second property is an apartment for investment. Let us say we are paying 6.050.000 TL, however the maximum the seller will declare the property at is 4.900.000 TL.
- The Valuation Surveyor carried out his job and valued the first property at 5.950.000 Tl and the second property at 5.850.000 TL. The total is 11.800.000 TL which makes $406.196,21 – CHECKED/APPROVED
- Total spent was 12.550.000 TL which makes $432.013 – CHECKED/APPROVED
- All criteria were met as we declared 11.900.000 TL total. Spent amount was over the minimum requirement, and the valuation was over the minimum amount too.
Recommended methods of investing for Citizenship
Sometimes one property is enough for all however most buyers prefer at least a home and an income generating investment. The choice will be yours.
We recommend positioning yourself about 10-12% above the minimum amount to avoid any complications. This way your application process will go smoothly.
If the property you will buy has been owned by the same person for over 5 years, we can declare this property in full. This is the ideal purchase.
The person you are buying from cannot be another foreign national who has been naturalised as a citizen via prior investment.
The cost of Citizenship application costs $3.500 for the first person, $4.000 for a family of up to 4 members, and $4.500 for the families of more than 4 people.
Turkey’s realistic position in the World
Turkey is a developing country in the Second World, a member of NATO and a candidate for European Union membership. The young population of Turkey makes its future exciting and the hybrid economic policies appeals all the World.
Since 2018, Turkey suffered heavily from the criticism of the new regime. The Covid-19 Pandemic, and lastly the Earthquake which affected about 15 million people in the South and Southeast of Turkey directly.
Despite all, Turkish economy is growing annually with investment in infrastructure. Energy, roads, and airports in an inflationist environment. The election in 2023 (*) will determine Turkey’s strategy in to its second century and the way is up, after a transition period of about 6-12 months in to 2024.
Turkey’s economical status
Now, especially when you borrow in Turkish Liras, you will see minus interest effect. The Interest parameter is 36.7%, however inflation is about 90%. Banks place themselves around 45-50%, so when you borrow let us say 100.000 TL at 48% you pay back 148.000 TL in one year. Your investment will be worth 190.000 TL and the 42% between is your gross advantage.
Normally we would advise short term payment plans to our clients. Let us say you borrowed in Turkish Liras at the longest term possible while Turkish currency is depreciating. You would have a temporary opportunity to buy multiple properties where you spread your capital between 2-3 units and take advantage of the lowering monthly instalments in USD/Euro or GBP.
All your questions about the economy will be answered here with a non-biased, transparent, impartial approach.
Please call +90 530 020 5369 for a friendly chat if you have questions about our country.
Buying Process
Who can buy in Mersin?
Unless you are from Armenia, Syria or you do not have a nationality of a sovereign state, you can buy property in Turkey without any problems.
How to buy a property in Mersin?
You just visit Mersin for a good time and some viewings with your passport and we will organise the buying process from A to Z.
In a nutshell the buying process requires a deposit of $2.000 to book the property and we will set dates for you so you can be ready to complete the deal.
If you cannot be in Turkey on the day you will sign papers, please see the information about POA’s HERE.
Buying Your Home
Building your home with MARE
In some cases, we work with our clients through the process of designing and developing their home or investment, because we have not really found the ideal option they have been looking for. Of course, trusting an agency about developing a property involves a thought process. At MARE, our references are from former clients who have worked with us. We back the testimonials with our knowledge and experience of the market and the construction industry.
We can develop your home on your land which you have bought before, or you can choose from the land options which are being marketed on our portfolio. We also create a tailor-made portfolio for you if you give us a mandate to deliver your dreams.
The process starts with the purchase of the land you choose where we decide what to develop, we have 3 options:
Flipping model
- You may be after a single home where you will live happily, permanently, or just on your holidays. If your land is large enough to develop two villas, our flipping model is exactly for you. We start building 2 or more villas on your land and as the construction reaches 40% complete, we start marketing the homes other than the ones you will live in. You pay 30% of the total construction cost in the beginning, and the rest in 7-10 instalments. As we give you a bargain, turnkey price per sqm in the beginning, when we sell your villa with about 30-35% profit, you take back your cash and make your home cost much lesser than planned in the beginning.
Pure investment for a profitable exit
- If you want to build a project where you will sell all the units, we are building for you from the start of the project. You pay 40% of the total construction amount and pay the rest in 10 months. We will setup a sales office, brochures and advertise your property for you professionally and as you are paying your instalments, you will have a cash flow coming in and once we have sold all your units, you will have a healthy profit over your total spent.
Building for your business
- To help you for building your business in Mersin, we will develop your office, showroom, warehouse, or factory for you at a fixed per sqm price. You will pay 50% of the total construction in advance and the rest in 10 months.
We have the workers team and professionals in place for all the projects you need.
Inspection Trips
Imagine you have interest in Mersin, and together we have formed a list of options you liked and would wish to view. At that point the next is to book your travel and accommodation. We help you organise your trip with suggested flights and hotels and host you in Mersin for 3 nights.
On the first day of your trip, there will be a comprehensive tour of areas mixed with the options we have listed. At the end of this day, you will have a good idea about which area and property you will be focusing on.
The next day we can revisit your favourites and ideally place an offer to see where the deal ends. If we have a deal, the third day is to open a bank account for you, get you a tax number, and if you would like us to sign the documents and send your title deed to you, we will have a specific POA which will allow us to take the property just to your name and complete your utility registrations.
Inspection trips are organised and saves time. The evenings are yours to enjoy Mersin’s delicious cuisine.
To know more about Inspection Trips and book your visit please call.
Video Tours
This section is for you if you would like to invest from distance. Sometimes, you would like to invest, and your hands are tied because you cannot travel.
With our video tours, we will first determine which options you would like to view on video, and we arrange a date and time you will be available on Google Meet or Zoom. For this you need about 2-3 hours at your desk, then if you liked any of the options, we have shown you on video, we start the negotiation and buying process.
You can appoint us, or a lawyer based in Mersin as your proxy, and he/she can get your title deed on your behalf. The procedure is transparent and straight forward.
Buying Cost – Taxes and Fees
Every country involves a standard or variable cost about purchasing a property. Turkey has its own taxation system and once you have bought a property you will automatically become a taxpayer.
The cost of buying involves a few different fixed and variable fees, most of them a percentage of an amount determined during the agreement process. Let us list all important items and see the likely amount for an example 2.000.000 TL home purchase.
- Normally the purchase price is expected to be declared in full, however commonly the amount people declare is above the minimum taxable rate of your property and much lesser than the purchase price you will be paying the seller. Standard property tax is a one-off payment of 4% over the declared amount. For this example, let us say we declared this property at 750.000 TL, so the tax to pay will be 30.000 TL (1.5% of the purchase price)
- Next is the buyer fee or Agency Fee. This is a standard 2% + VAT and it makes 47.200 TL (2.36%)
- The valuation of your property will cost about 6.000 TL and it is mandatory.
- Passport translation, Earthquake Insurance, Utilities registration, and Title Deed Registrar’s fixed fee and all other documents cost about 7.000 TL for this 2.000.000 TL purchase.
- In total the buying cost for this purchase is 90.200 TL a fair 4.51%.
- If we declared the property in full the total cost would have been 140.200 TL (7.01%) which is the case when you are applying for Turkish citizenship (*).
As you can see the buying cost is most likely to be between 4-6% of the purchase price.
(*) For Turkish Citizenship and the cost of application please see the article about Turkish citizenship HERE
Financing your purchase
Mortgages are an essential part of investment. The law, and relatively lower interest mortgages were introduced around 2010, however for foreign buyers’ loan options are limited compared to residents/taxpayers.
Interest rates are high, however as of 2023 interest rates are well lower compared to the actual inflation level. So, until it changes significantly there is a minus interest opportunity in Turkey.
For example, say we borrowed 200.000 TL with 5 years to pay back, at an interest rate of 2.00% per month, that is 24% per annum. Interest rates are at 59% pa in April 2023. According to experts, it is over 100% pa. Your monthly instalments will be 5.740 TL per month for 60 months, however the value of the same amount will be lesser each quarter of the years to come.
You could take advantage of this opportunity, also because USD, Euro, GBP are very strong in Turkey. As your instalments in TL, the higher your currency, the lower your instalments are going to be.
As situation changes, this article will be updated accordingly.
Power of Attorney
Power of Attorneys are required especially you are based overseas and cannot come to Turkey when you are buying or selling your property. POA’s are specific to task so they are very secure. They can be issued and sent to us from the country you are based in via Turkish Consulate or Embassies.
This is a secure, transparent, and practical way of investing in Mersin, which saves time for you.
On a Power of Attorney there will be your and your representative’s ID details, addresses and contact numbers, and the statement will contain what authority you are giving to your representative.
For example, when you are buying a property, we will know which one you are buying, so its details will be there, as well as the other jobs like utility registrations etc.
If you are selling the POA would have authority to cancel your utility agreements and receive and return your deposits, as well as the authority to sell your property.
We can discuss what type of POA you will appoint, to whom (a lawyer or our agency), and how long it will be valid, i.e., just for one job, or continuous.
Developing Your Home
Property Taxes
Income Tax
Income tax is based on declaration when it comes to a small portfolio of properties in Turkey, and in most cases, because you receive your rental income abroad, you will not be taxed in Turkey.
Let us see how the tax system works with a realistic example. You have an apartment you bought for 2.000.000 TL, and it is rented out for 100.000 TL per annum.
The allowance is 35.000 TL, this amount is not taxed. So, your taxable income is 65.000 TL.
There is a fixed cost allowance of 15% where you do not have to show any bills or documents.
Your net taxable income is 55.250 TL.
In most cases income tax starts from 15% and goes up to 35% as the income grows.
You would pay about 7.000 TL as tax for this investment. 7% over your total income.
For more information or detailed information, we give basic financial advice, free of charge, and we have bookkeeping services at reasonable prices.
Capital Gains Tax
The sense of investment is capital appreciation, and profits over purchase price when it comes to property are taxed.
When you have purchased a property the ideal time to exit your investment is 5 years. After 5 years, you will be exempt of capital gains tax.
Inheritance Tax
Inheritance Tax starts from 10% and goes up to 30% amounts over 20.100.000 TL (2023) in Turkey.
|
First 1.100.000 ₺ |
10.00% |
|
The 2.600.000 ₺ after |
15.00% |
|
The 5.500.000 ₺ after |
20.00% |
|
The 10.900.000 ₺after |
25.00% |
|
Amounts over 20.100.000 ₺ |
30.00% |
For example, let us say you will inherit a 30.000.000 TL property
Total TAX 7.295.000 TL
Life in Mersin
Easy Seaside Living in Mersin
All cities on the Mediterranean are special, however Mersin stands out especially from an investors angle, especially when it comes to price, growth potential.
You could consider Mersin as your home and where you will set up your business. With its International Port and Free Zone, Mersin is a centre for trade and logistics.
The new international airport will bring accessibility and prosperity to the market and further boost the cities chances of becoming the new investment destination of Turkey.
Its virgin coastline with vast land for development, and its fertile land for high return agricultural investment, Mersin invites you to look at your options with MARE Investment.
Low cost lifestyle in Mersin
Turkey is still very affordable to foreign visitors, although places like Istanbul, Bodrum and Antalya reach the levels of Italy, Spain or the UK about accommodation, foods and beverage, and travels.
Mersin is still way more affordable compared to other seaside cities of Turkey on the Aegean and Mediterranean coasts. Its cuisine is variable and comes at a good price. Tags are in Turkish Liras, and you will not be treated as a tourist in Mersin and pay just like locals.
When we compare the monthly utility bills in Europe and UK to bills in Turkey, you will see Turkey is much more affordable for the use of the same amount of gas, electricity, and water.
For example, if you are paying £200 per month in the UK for your Water, Gas, Broadband and Electricity at a one-bedroom flat, that makes about 4.830 Turkish Liras. In Turkey in a same size, similar location one bedroom flat you would pay about, 450 TL for electricity, 250 TL for broadband, 100 TL for water, and about 750 TL for gas, which totals 1.550 TL.
It costs less than half for bills, and for life and entertainment the cost of everyday activities would be 25% to 40% less in your own currency. Especially if you are in a position to work from home and anywhere in the World, Mersin is great with its warm 4 seasons, beaches and mountains.
From parking fees to car wash, a cup of tea to a portion of Kebab, Mersin is going to save you a great deal over time.
Healthcare
Mersin is a large metropolitan area, so it is an attractive destination for good doctors, with its private, university and state hospitals. For foreign settlers paying annually for a proper health insurance is the best idea, as prices are in Turkish Lira.
Where to settle in Mersin?
Mersin has 4 main boroughs. In alphabetical order they are, Akdeniz (Downtown), Mezitli (The West and The Best), Yenisehir (Where everything is – Posh), Toroslar (The North and Mountains).
Akdeniz:
Akdeniz is mainly the old town and the market developed around it. Administrative centre of Mersin is here, as well as the Mersin International Port, Opera House, Organised Industrial Zones. So apart from the old residential mainly low and upper middle income residential areas, Akdeniz is Mersin’s commercial and Industrial hub.
Settling your family here: No
Setting up your business, warehouses, and factories: YES
Mezitli:
Mezitli was 10 km out of the city about 30 years ago. Now, however it is one of the most sought-after locations to settle in because of the seafront compounds with great landscaped green space and humongous open pools and other amusing facialists.
Mezitli has nice new building stocks by the sea, and up the road with mountain views too. Pompeiipolis – Viranşehir ruins make Mezitli a special location for walking paths and bike lanes.
The D-400 Mersin-Antalya Road is the main axis and to its North the parallel roads, Fatih Sultan Mehmet Street, and İsmet İnönü Boulevards are making commute times easier for residents.
Settling your family here: YES
Setting up your business here: YES if it is not an industrial company
Toroslar:
The borough is named after the Toros mountains because most of the mountain villages called ‘Yayla’ are within Toroslar’s land. To its South there is the centre of town and Toroslar is mainly known as a middle and lower-middle income area in terms of its community. Prices are relatively more reasonable compared to Yenisehir.
Towards the mountains though, the story changes for Toroslar, because especially just to the North of the Motorway, areas like Buluklu and Çopurlu are developing as city view, luxury villa zones as an alternative to Eski Mezitli, Kuyuluk and 50. Yıl.
Settling your family here: YES, if you want a villa out of the hustle and bustle of the city
Setting up your business here: YES for industrial and wholesale, NO for retail and offices
Yenisehir:
Mersin has become a Buyuksehir in the late 90’s and Yenisehir was the most popular one as it hosts the city’s famous seaside quarter Pozcu. Later, in around 2006-2007 the Forum Mersin Shopping Centre opened and Pozcu became the second commercial centre of the city where the retailers and many businesses have moved their stores to. This made Yenisehir grow towards the North of Pozcu and luxury residential neighbourhoods like Fuat Morel, Limonluk and Deniz are developing to the North and on the coast Mersin Marina, and on the North the Mersin Olympic Stadium were added to the list of Landmarks of Yenisehir over the years.
Simply, Yenisehir is the most sought-after part of Mersin and on average prices here are the highest, compared to Mezitli, the other coastal borough of the city.
Settling your family here: YES
Setting up your business here: YES, if your business is not involved in heavy industries.
Life in Mersin
What are we offering?
At MARE, we would like to have sincere and continuous relationship with you. So, we offer sincerity, transparency and thorough support in all areas of investment.
Get in touch with us and let us write your investment story together.