Navigating Real Estate Acquisition in Türkiye: A Comprehensive Guide for Foreigners and Foreign-Capitalised Entities

Welcome to the comprehensive guide on real estate acquisition in Türkiye (Turkey) for foreign individuals and foreign-capitalised legal entities. This article, drawing upon key Turkish legislation and regulations, including the Tapu Law (Land Registry Law) and related circulars, aims to provide a clear understanding of the processes, requirements, and limitations in effect as of 2021. This information is based on the official publication "Taşınmaz Hukukunda Yabancılara İlişkin Mevzuat" by the General Directorate of Land Registry and Cadastre.

1. General Principles of Real Estate Acquisition by Foreigners

In Türkiye, the acquisition of immovable property by foreign real persons and legal entities is regulated primarily by Article 35 of the Tapu Law. The Turkish President holds the authority to determine, limit, partially or completely halt, or prohibit the acquisition of immovable property and limited in-rem rights by foreign real persons and foreign-established trade companies based on country, person, geographical region, duration, number, ratio, type, characteristic, area, and quantity, where deemed necessary for national interests.

The General Directorate of Land Registry and Cadastre's Department of Foreign Affairs is specifically tasked with tracking, regulating, and maintaining up-to-date records of real estate transactions involving foreign individuals and legal entities within Turkey.

2. Who Can Acquire Property in Türkiye?

The eligibility for real estate acquisition depends on the nature of the foreign entity:

2.1. Foreign Real Persons (Individuals)

Foreign individuals are generally permitted to acquire immovable property and limited in-rem rights in Turkey under specific legal provisions and conditions.

2.2. Foreign Legal Entities Established Under Their Own Laws (e.g., Foreign Companies)

Legal entities established in foreign countries under their respective national laws can acquire immovable property and limited in-rem rights only within the framework of special legal provisions. Unless specifically permitted by such special laws, these entities cannot acquire immovable property or establish limited in-rem rights in their favour. However, restrictions do not apply to the establishment of real estate mortgages (taşınmaz rehni) for these companies.

2.3. Turkish Companies with Foreign Capital (Companies Under Tapu Law Article 36)

These are Turkish-established legal entities where foreign investors, collectively or individually, hold 50% or more of the shares, or possess the authority to appoint or remove the majority of the management. Such companies are permitted to acquire immovable property or limited in-rem rights in Turkey to carry out activities specified in their articles of association.

Exemptions from Article 36 Regulations for Foreign-Capitalised Turkish Companies: Certain transactions are exempt from the standard review and approval process required under Article 36, meaning they are processed under general rules. These include:

• Establishing a real estate mortgage (taşınmaz rehni).

• Acquisitions resulting from the foreclosure of a mortgage, particularly if the acquirer is a bank and there is a legal obligation to dispose of the property within a specific period.

• Transfers of immovable property and limited in-rem rights arising from company mergers or divisions.

• Acquisitions of immovable property and limited in-rem rights within designated special investment zones such as Organized Industrial Zones, Industrial Zones, Technology Development Zones, and Free Zones.

Companies Outside Article 36 Scope: Foreign-capitalised companies that do not meet the 50% ownership or control criteria as defined by Article 36 are treated like domestic companies and can acquire property under the same regulations. For such companies, the official deed must include a declaration stating they are not foreign-capitalised and accepting responsibility for any misrepresentation.

2.4. International Organisations and Foreign Missions

Various international bodies and foreign missions also have specific provisions for property acquisition:

• International Finance Corporation (IFC): Has the capacity to acquire and dispose of movable and immovable property.

• International Centre for Settlement of Investment Disputes (ICSID): Can own or sell movable and immovable property.

• UNICEF: Possesses the necessary capacity to acquire and dispose of movable or immovable property.

• World Health Organisation (WHO) Istanbul Office: Can acquire immovable and movable property.

• NATO Allied Headquarters: The Turkish government can allocate state-owned land and buildings free of charge for their military needs. These headquarters can also independently contract for the acquisition of necessary properties and facilities.

• Foreign Diplomatic Missions (Embassies/Consulates): All property-related requests (purchase, sale, lease, alteration, construction) must be directed through the Turkish Ministry of Foreign Affairs for approval. Direct contact with other Turkish institutions by foreign missions for information or documents regarding property is discouraged as it can create issues with the principle of reciprocity.

  
  

3. Key Restrictions and Limitations

Several critical restrictions apply to foreign real estate acquisitions in Turkey:

3.1. Geographical Restrictions

• Military Forbidden Zones (1st and 2nd Degree) and Security Zones: Foreign real persons and legal entities are generally prohibited from acquiring immovable property in these areas. Existing foreign-owned properties in first-degree military forbidden zones may be subject to liquidation. Temporary entry, residency, work, or leasing in these zones requires permission.

• Special Security Zones: Acquisition of immovable property by foreign real persons in special security zones requires permission from the Governorship (Valilik) where the property is located. This permission is granted based on an assessment by a commission for suitability concerning national security. Foreign legal entities, other than foreign-established trade companies, cannot sell, transfer, or lease property in these zones.

• Strategically Important Areas: The Council of Ministers (now the President) can designate areas near military forbidden zones or other strategically important locations where foreigners are prohibited from acquiring property or leasing without permission.

• Village Areas (Köy): Foreign real persons and legal entities are explicitly prohibited from acquiring real estate in villages. If properties in villages are inherited by foreign nationals, they must be liquidated if not subsequently transferred to Turkish citizens.

• Areas Outside Municipal Boundaries (Mücavir Alan, İnkişaf Alanı): Immovable properties located outside municipal boundaries, even if included in development plans, cannot be acquired by foreign nationals.

• Tourism Zones: Acquisition of property located outside municipal boundaries but within designated tourism zones or centers requires specific instructions from the General Directorate of Land Registry and Cadastre.

• Sit Areas (Historical, Archaeological, Natural Sites): For acquisitions of property in designated sit areas by foreign real persons, the request must be evaluated by the Ministry of Culture and Tourism or the Ministry of Environment and Urbanization for compliance with relevant legislation. However, for transactions other than acquisition (e.g., subdivision, merging, change of property type), or for properties acquired before August 6, 2012, or properties inherited by foreigners from Turkish citizens, no new sit area permission is required if the initial acquisition or transfer was completed with the necessary approval. These transactions are processed under general regulations.

  
  

3.2. Area Limitations

Foreign real persons are limited to a maximum of 30 hectares (300,000 square meters) of immovable property nationwide. Acquisition requests exceeding this limit will be rejected by the Land Registry Directorates.

3.3. Project Development Requirement for Undeveloped Land (Yapısız Taşınmaz)

Foreign real persons who acquire undeveloped land (e.g., plots, fields, vineyards, gardens without existing structures) are obligated to develop and submit a project for the property to the relevant Ministry for approval within two years from the acquisition date.

• The property deed will include an annotation indicating this project development obligation.

• Failure to submit or implement the approved project within the stipulated timeframe will result in the liquidation (tasfiye) of the property.

• This obligation applies to sales acquisitions by all foreign real persons, with the exception of citizens of the Turkish Republic of Northern Cyprus (TRNC) and Blue Card holders.

• Agricultural Land: Acquisition of agricultural land by foreign real persons requires prior approval from the provincial directorate of the Ministry of Food, Agriculture and Livestock. This approval is based on criteria related to "sufficient income agricultural land size". Acquisitions below this threshold by foreign individuals who do not already own agricultural land in the same district will be directly rejected.

  
  

3.4. Currency Regulations for Real Estate Transactions

• General Rule: As of September 13, 2018, contracts for real estate sales and leases, including residential and commercial properties, between residents in Turkey cannot be denominated in foreign currency or indexed to foreign currency.

• Key Exceptions:

  • Real estate sales and lease contracts where one of the parties is a person not a citizen of the Republic of Turkey who is residing in Turkey.

  • Real estate lease contracts for the operation of accommodation facilities certified by the Ministry of Culture and Tourism.

  • Real estate lease contracts for duty-free shops.

• For existing contracts that fall under the general prohibition, the contract amount and other payment obligations must be redetermined in Turkish Lira. If the parties cannot reach an agreement on the new amount, the value will be determined by calculating the Turkish Lira equivalent using the Central Bank of the Republic of Turkey's (CBRT) effective selling rate from January 2, 2018, and then increasing it based on the monthly Consumer Price Index (CPI) determined by the Turkish Statistical Institute until the date of redetermination.

• When foreigners acquire property by converting foreign currency, the original "Döviz Alım Belgesi" (Foreign Currency Purchase Document) issued by banks or special finance institutions must be kept as evidence in the land registry records.

• For properties acquired without foreign currency conversion, the sales proceeds cannot be transferred abroad but can be freely used within Türkiye.

  
  

4. Acquisition Processes and Required Documentation

The process for acquiring immovable property in Türkiye involves several steps and requires specific documentation.

4.1. General Process and Identity Verification

• All requests are examined by the land registry director or a designated land registry official.

• Identity verification is paramount.

  • Turkish Citizens: Must provide a Turkish identity card with their Turkish ID number.

  • Foreign Real Persons: Must provide an identity document or passport issued by the competent authorities of their country of nationality. If the document is in the Latin alphabet, a Turkish translation is generally not required unless specifically deemed necessary by the Land Registry Directorate. If the document is in a non-Latin alphabet, a translation may be required.

  • Palestinian Citizens: Their residence permit issued by the Directorate General of Migration Management is accepted alongside their national ID/passport. Other countries' travel documents (e.g., refugee travel documents) may also be accepted if they explicitly state "Palestinian" nationality. If nationality is not clearly stated, an official document from their country's authorities (e.g., birth certificate) with consular approval (apostille or Turkish consulate approval) is needed.

  • Blue Card Holders: Individuals holding a Blue Card (for those who exited Turkish citizenship with permission) can use this card as their identity document. If they present a passport or ID card from their acquired nationality without the Blue Card, their Blue Card status can be verified through the MERNİS system or population registry records.

  • Foreigner ID Number (YKN): A unique "Foreigner ID Number" is required for foreign real persons in all land registry and cadastre transactions. If a person does not have one, it is assigned through the "GöçNet" system via TAKBİS (Land Registry and Cadastre Information System) during the transaction.

  • Identity Information Declaration Form (Kimlik Bilgileri Beyanı Formu): All foreign real persons must complete this form for any land registry transaction. This form aids in obtaining the YKN and ensures accurate data entry into the land registry system. A photo is required for direct applications, but not when the transaction is conducted via proxy. Information not present on the passport (e.g., mother's or father's name) can be provided through this declaration.

    
    

4.2. Power of Attorney (Vekaletname)

If a transaction is conducted via a power of attorney, specific rules apply:

• Powers of attorney (PoAs) must be drafted in accordance with the Turkish Notary Law.

• PoAs issued abroad:

  • From Hague Apostille Convention Member States: Must bear an Apostille annotation. No further verification is required by the land registry office.

  • From Non-Hague Apostille Convention Member States: The notary's signature must be certified by a superior authority, and that authority's signature and seal must be approved by the Turkish Consulate in that country.

  • General Requirements for all PoAs issued abroad: They must be prepared in the official language of the issuing country, include the photograph of the principal, and a notarized Turkish translation is required. The PoA must explicitly state the authority for the specific transaction intended. PoAs must be based on the principal's passport, ID card, or (for Blue Card holders) a Blue Card issued after April 12, 2013. Other travel documents, residence permits, or driver's licenses are not sufficient underlying documents for a PoA.

    
    

4.3. Valuation Report (Değerleme Raporu)

• Requirement: A real estate valuation report is mandatory for all sale transactions where a foreign real person is involved, either as a buyer or a seller. It is also required for real estate acquisitions made for the purpose of obtaining Turkish citizenship.

• Preparation and Standards: The report must be prepared by an authorized valuation institution (listed by the Capital Markets Board of Turkey (SPK) or the Union of Turkish Appraisers (TDUB)) in compliance with international valuation standards.

• Validity: A valuation report is generally valid for three months from its date of issue. A new report is required if the property's value changes due to modifications such as a change in type (e.g., from land to building), road abandonment, or the establishment of an easement right.

• Content: The report must show the market value (current market value/current status value) of the property and this value must be recorded in the official deed. It should include at least three interior and exterior photographs of the property.

• Submission: Valuation reports can be submitted electronically via the Registered Electronic Mail (KEP) system with an e-signature from the authorised valuation firm, or physically with a wet signature to the Land Registry Directorates.

• Responsibility: The valuation institution and the individual appraisers are responsible for the accuracy of the data and information contained in the report.

  
  

4.4. Process for Turkish Companies with Foreign Capital (Article 36 Companies)

Companies falling under the scope of Tapu Law Article 36 (i.e., foreign investors owning 50% or more, or controlling management) must follow a specific application procedure:

• Application: Application is made to the Provincial Directorate of Planning and Coordination in the province where the property is located.

• Required Documents: The application must include a petition, land registry information with coordinated plot examples, a commitment letter (Ek-1) stating that the property acquisition is for activities listed in the company's articles of association, an authorization document from the trade registry showing the company's authority for property transactions and identifying its representatives, and shareholder information (for non-publicly traded companies). If foreign investors have majority appointment/removal power despite holding less than 50% shares, the company's approved articles of association are also required.

• Review and Approval: The process involves obtaining approval from relevant military authorities (General Staff, Governorship) depending on whether the property is located in military forbidden or security zones. The suitability of the acquisition from a national security perspective is assessed by a commission.

• Validity of Approval: An approval for acquisition is valid for six months for registration. If the registration is not completed within this period, the application must be renewed.

• Non-Article 36 Companies: Foreign-capitalized companies that do not meet the criteria of Article 36 (less than 50% foreign ownership or control) are governed by the same rules as domestic companies.

  
  

5. Special Cases and Exemptions

5.1. Inheritance (Miras İntikal)

Foreigners can acquire property in Turkey through inheritance. The restrictions stipulated in Tapu Law Article 35 do not affect a person's legal capacity to inherit, but rather their right to retain the inherited property. Therefore, the inheritance process should be completed first, and then the legality of the foreigner retaining the property is assessed based on current legislation. For foreign court decisions enforcing wills, if a Turkish court has recognized and enforced a foreign will, no additional specific registration clause or letter from the foreign court is required for the land registry.

5.2. Acquisition for Turkish Citizenship

Foreign nationals can acquire Turkish citizenship by purchasing immovable property (or by promising to purchase property through a notary-issued sales promise contract) that meets a specified value, provided that the property is not sold for a period of three years.

• Value Thresholds:

  • For properties purchased between January 12, 2017, and September 18, 2018, the value must be at least 1,000,000 USD.

  • For properties purchased after September 19, 2018, the value must be at least 250,000 USD.

  • Sales promise contracts, formalized by a notary, are also included in this provision for contracts executed after December 7, 2018, requiring a value of at least 250,000 USD.

• Property Eligibility:

  • The property must not be registered in the name of another foreign real person (including the applicant's spouse or children).

  • The property must not have been transferred from a foreign real person (of the same nationality as the applicant) to a Turkish citizen or company after January 12, 2017, for the purpose of citizenship acquisition by the current applicant.

  • The property must not be owned by a company in which the applicant, their spouse, or children are partners or managers, or by a foreign-capitalized company of the same nationality.

  • Once citizenship is obtained through a specific property, that property or its share cannot be used again for another citizenship acquisition application.

• Number of Properties: There is no restriction on the number of properties, as long as their combined value meets the required threshold for citizenship.

• Valuation Report: A valuation report is mandatory for all transactions for citizenship acquisition.

• Payment Method: Payments for the property must be made via bank transfer, and verified by official bank receipts (Havale, EFT, or blocked check with receipt). For sales promise contracts, the payment must be made before or on the day the contract is notarized.

• Non-Sale Commitment: A commitment that the property will not be sold for three years must be included in the official deed or registration request and annotated in the land registry. This annotation restricts the transfer and cancellation of the sales promise contract for the three-year period.

• Family Residence Annotation: For foreigners, a "family residence annotation" on a property is possible under the same rules as applied to Turkish citizens.

  
  

5.3. Turkish Citizens Who Exited Citizenship with Permission (Blue Card Holders)

Individuals holding a "Blue Card" (Mavi Kart), issued to Turkish citizens who formally exited Turkish citizenship with permission, enjoy the same property acquisition rights as Turkish citizens in Turkey. They are explicitly exempt from reciprocity requirements applicable to other foreigners. While generally exempt from specific foreign property regulations, they are now required to complete the "Identity Information Declaration Form" and obtain a Foreigner ID Number (YKN) to access online services like "web-tapu" and ensure clearer identity verification.

5.4. Turkish Republic of Northern Cyprus (TRNC) Citizens

Citizens of the Turkish Republic of Northern Cyprus (TRNC) are accorded the same property acquisition rights as Turkish citizens in Turkey, benefiting from exemptions from legal restrictions applied to other foreign nationals. Official documents issued by TRNC authorities do not require consular approval for use in Turkish land registry transactions. They are also exempt from the valuation report requirement for property acquisitions and the project development obligation for undeveloped land. Similar to Blue Card holders, they are now required to complete the "Identity Information Declaration Form" and obtain a Foreigner ID Number (YKN) to utilize web-tapu services.

5.5. Stateless Persons (Vatansız Kişiler) and Refugees

• Stateless Persons: Legally residing stateless persons are treated as favorably as possible for movable and immovable property acquisition, leases, and related rights, and in no case less favorably than foreigners in general under the same conditions. For housing acquisition, they receive treatment no less favorable than that granted to foreigners. Identity documents are issued to stateless persons without valid travel documents.

• Refugees: Individuals granted refugee status (typically due to a well-founded fear of persecution in their country of origin if from Europe, or habitual residence if stateless) are issued identity documents valid for three years and travel documents. Refugee status holders are exempt from reciprocity requirements.

  
  

6. Consequences of Non-Compliance

Properties acquired or used in violation of the applicable regulations may be subject to liquidation (tasfiye). If the owner fails to dispose of such property within a period specified by the Ministry of Finance, it will be liquidated, converted into cash, and the proceeds paid to the rightful owner. Furthermore, providing incorrect or misleading information or documents can lead to criminal charges. For properties acquired with Value Added Tax (VAT) exemption, if the property is disposed of within one year, the uncollected VAT plus late payment interest must be paid before the deed transfer.

7. Data Reporting and Information Sharing

The General Directorate of Land Registry and Cadastre, specifically its Department of Foreign Affairs, is responsible for monitoring, regulating, and maintaining up-to-date records of all immovable property transactions involving foreign individuals and legal entities. Statistical data ("raporlaştırılmış veri") compiled by the Department of Foreign Affairs can be shared with other public institutions and, upon request, with individuals, provided that privacy and data protection regulations are observed. Land Registry Directorates are also required to report foreign property transfers to the Revenue Administration.

It is always best practice to obtain legal advice before making decisions about investing in or disposing of real estate assets in Türkiye, given the complexity of the legal framework and the potential implications of non-compliance. Careful legal guidance helps ensure that transactions are carried out in line with current regulations and safeguards all parties involved.

Disclaimer: This article is intended for informational purposes only and does not constitute legal or tax advice.