Turkey (TR) Registering a Property

This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has five dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in May 2019.

What the indicators measure

Procedures to legally transfer title on immovable property(number)

• Preregistration procedures (for example, checking for liens,notarizing sales agreement, paying property transfer taxes)
• Registration procedures in the economy’s largest business city.
• Post registration procedures (for example, filling title with municipality)

Time required to complete each procedure (calendar days)

• Does not include time spent gathering information
• Each procedure starts on a separate day — though procedures that can be fully completed online are an exception to this rule
• Procedure is considered completed once final document is received
• No prior contact with officials

Cost required to complete each procedure (% of property value)

• Official costs only (such as administrative fees, duties andtaxes)
• Value Added Tax, Capital Gains Tax and illicit payments are excluded

Quality of land administration index (0–30)

• Reliability of infrastructure index (0–8)
• Transparency of information index (0–6)
• Geographic coverage index (0–8)
• Land dispute resolution index (0–8)
• Equal access to property rights index (-2–0)

Case study assumptions

To make the data comparable across economies, several assumptions about the parties to the transaction, the property and the procedures are used.

The parties (buyer and seller):-

• Are limited liability companies (or the legal equivalent).
• Are located in the peri urban (that is, on the outskirts of the city but still within its official limits)area of the economy’s largest business city. For 11 economies the data are also collected for the second largest business city.
• Are 100% domestically and privately owned.
• Perform general commercial activities.

The property (fully owned by the seller):

• Has a value of 50 times income per capita, which equals the sale price.
• Is fully owned by the seller.
• Has no mortgages attached and has been under the same ownership for the past 10 years.
• Is registered in the land registry or cadastre, or both, and is free of title disputes.
• Is located in a periurban commercial zone (that is, on the outskirts of the city but still within its official limits), and no rezoning is required.
• Consists of land and a building. The land area is 557.4 square meters (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in good condition, has no heating system and complies with all safety standards,building codes and legal requirements. The property, consisting of land and building, will be transferred in its entirety.
• Will not be subject to renovations or additional construction following the purchase.
• Has no trees, natural water sources, natural reserves or historical monuments of any kind.
• Will not be used for special purposes, and no special permits, such as for residential use,industrial plants, waste storage or certain types of agricultural activities, are required.
• Has no occupants, and no other party holds a legal interest in it

Registering Property — Turkey

Procedures (number)

6

Time (days)

4.5

Cost (% of property value)

3.0

Quality of the land administration index (0–30)

27

Details — Registering Property in Turkey — Procedure, Time and Cost

Procedure 1:.

The buyer conducts a non-encumbrance check on the property:

Agency Land Registry Office Although not mandated by law, non-encumbrance checks are essential procedures. Without them,buyers do not proceed with the transfer process. The buyer almost always checks whether or not the property is free of liens and encumbrances. For this, the seller would need to obtain the document showing that the property is free of disputes.By law, title deeds are open to anyone who legitimizes their interest. However, in practice therecords are not accessible to the public: the buyer can obtain this document only with a powerattorney of the seller. Therefore, this document is typically obtained by the seller who is often accompanied by the buyer. For transactions that are undertaken by lawyers, this procedure is conducted by lawyers (who have the power of attorney from the seller and have a legal right to search titles).The seller or the interested party takes an appointment on the general IT (TAKBIS) system to be present at the Land Registry office at the given time. The information at the Land Registry is computerized; so the search takes minutes. Conducting a non-encumbrance check is free of charge for the real person owner or for those who hold a right on the relevant property (or their representatives). In September 2017, the Land Registry introduced a new online system(WebTapu) which allows individuals to look into the details of their property electronically via e-government without visiting land title offices. One of the advantages of web-deed system is that the property owner (individual) may authorize his/her real estate agent to look into the details of his/her property electronically and this is free of charge.

If the buyer or seller wish to obtain a copy of the records displaying the status of the property, a fee applies (TL 9.30 per page + a fixed fee of TL 21 that only applies if it is not the owner of the property who is requesting a copy of the records). If the application is made in a land registry office other than the land registry office which the property is registered at, then the applicant is required to pay an additional fixed fee of TL 42.

Time to Complete

Less than one day, online

Associated Cost

TRY 37.5

Procedure 2:.

Managers obtain an authorization certificate of their authority to conduct transactions on companies’ behalf:

Agency Company Registrar If the sale transaction will be made in person by the company signatories, the managers should obtain a separate document from the trade registry, showing that they have the authority to conduct transactions before the land registry office on their companies’ behalf. According to the General Communiqué of Act of Fees №80, the cost for obtaining an authorization certificate for company managers is TL 44. However, the registration and announcement of the authorization ofa company’s manager in the Trade Registry Gazette costs TL 420.60.If the sale transaction will be conduct by a proxy issued by the company signatories, the representatives should be provided with special proxies, which will be drawn by the notary and bear the photograph and the statement of the authorized manager. The notary would require the manager to provide it with the above mentioned authorization document which should be obtained from the trade registry and the signature circular of the company setting out the authorized signatories of the company and the way in which they are authorized to represent the company.The notary will charge a fee of approximately TL 200 for issuing the power of attorney. The validity period of this authorization certificate is one year as of its date of receipt.

Time to Complete

1 day

Associated Cost

TRY 54.4

Procedure 3:.

Obtain a property tax clearance letter and a real estate value statement from the Municipality:

Agency Municipality The parties need to obtain a document showing (i) the current value of the property; and (ii) that there are no outstanding debts related to the property tax from the local municipality. This letter is required by Turkish Real Estate Tax Law №1319, and Land Registry Law №2,644. The document states (i) whether there is any unpaid property tax liability as of the date of issuance of the document; and (ii) the current minimum benchmark market value of the property (for the year in which the document is requested).

This value statement is used by the land registry officer to determine the mortar dues.

The parties could obtain this document either from offices of the relevant municipality or online.The online service can be accessed through www.turkiye.gov.tr, this service is free of charge.However, obtaining this document online is still not a common practice in Istanbul. Therefore, the seller obtains the value statement in person from the municipality where the real estate is situated.

The municipalities update these value statements every year by categorizing properties according to their location and features.

Time to Complete

1 day

Associated Cost

no charge

Procedure 4:.

Parties apply for registration and obtain tax payment assessment:

Agency Land Registry officeThe owner of the real property has now opportunity to make an online application for the sale of the property through online through web tapu. So, the parties don’t have to be present before the land registry office to make the application. With the new system, the owner of the property can upload the necessary documentation and information while making the application. After that, the documents will be examined by the officers and will send and SMS to the owner regarding the registration fee and mortar dues calculated as per the declared purchase price (or value of the property determined by the municipality, whichever is higher). After payment of the relevant fees,the parties should be present for the signature before the land registry office on the date and time appointed by the land registry. The parties should also submit original copies of the documentation uploaded through the web tapu website while making the application. The documentation shall include;

The documentation will include:

(i) Copies of the tax registration certificates of the buyer and seller companies;

(ii) The notarized proxies of the representatives (if they will perform the transaction);

(iii) The identity cards of signatories (passport for foreigners);

(iv) One photograph of the seller (or his representative) and two photographs of the buyer (or his representative);

(v) Signature circular of the buyer company and seller company;

(vi) Title deed copy or information regarding the title deed of the property;

(vii) A document showing the current value of the property, issued by the relevant municipality;

(viii) An earthquake insurance policy (it is not required if the property does not fall within the scope of the Law of Natural Disaster Insurance numbered 6305 published in the Official Gazette dated18 May 2012 numbered 28296); and

(ix) Signatories shall keep the seal of the company available during the procedure.

(x) Loan documentation (if the property is bought by taking out a loan

Time to Complete

less than one day, online

Associated Cost

no charge

Procedure 5:.

Registration fee is paid at a commercial bank:

Agency Commercial Bank Mortar dues are paid to the bank account of the land registry, and the bank will give a receipt of the payment. The mortar due is equal to 4% of the declared amount in Turkish Lira, collected 2%each from the parties, but in practice usually the purchaser pays all. On September 30, 2017,mortar increased back to 4% of the sale price of the property as by decree of the Council of Ministers is numbered 2017/9973. The parties also pay a registration fee (Döner Sermaye HizmetBedeli) to cover overall expenses of Land Registries in Turkey. This is usually paid by the purchaser to the bank account of the Land Registry. Registration fee is calculated by multiplying TL 103.50 fixed charge with local coefficients subject to the Law regarding Service Charges to BeCollected by Land Registry Offices numbered 6544. Local coefficient for all districts of Istanbul isset out as 2.5 in the tariff published by the Directorate General of Land Registry and Cadastre.Therefore, the total amount of the service charge of a property transfer transaction carried out at a land registry office in Istanbul for a two-story building will be TL 258.75. General IT system informs the concerned parties with a text message when the service charge and land registry fee should be paid at the commercial bank. Land registry fees and service charges can also be paid online via IT system of the General Directorate of Land Registry and Cadastre. This message is being sent to the parties after the evaluation process is completed by the land registry officers. The commercial bank to which the service charge and land registry fee are deposited is a bank designated by the land registry office. In other words, the parties have to deposit the concerned amounts to the bank account of land registry office at a bank determined by the land registry itself.

Most of the payments are made in electronic environment according to the electronic collection number given by the electronic system. Moreover, online payment can be made from the web-tapu system established by TKGM.

Time to Complete

less than one day, online

Associated Cost

TRY 66,759.31;(Registration fee of TL 128 multiplied by Istanbul’s local coefficient of 2.5 +3% of declared transaction price (mortar dues) or 3%of the taxable value of the real estate (whichever is higher) + TL 17.5 as fixed fees

Procedure 6:.

Transaction is completed at the registry office:

Agency Land Registry office Once all the above Procedures are fulfilled, a text message sent from general IT office of Land Registry that the parties should be present at the land registry office at the appointment hour decided previously by the Land Registry for the finalization of the transaction.The parties meet at registry office before the registry manager or his deputy at the appointment hour decided previously. The purchaser pays the consideration at that time. If it has already been paid, the seller would declare that it has already been fully paid. Then the parties both sign the land record sheet and the photographs of each of the parties are attached to the document. Each person witnesses that he/she had made the transaction mutually with the person in the picture,the transfer of the title is then completed. The documentation shall include: payment receipts and ID cards.

Time to Complete

1 day

Associated Cost

paid in Procedure 5

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