Real Estate Valuation Report for Foreign Buyers in Turkey

Valuation Report for Foreign Buyers in Turkey: According to a circular issued by the TKGM (Turkish General Directorate of Land Registry and Cadastre) on February 15th, foreign property buyers in Turkey will need a real estate appraisal report stating the property’s value before the transaction can be approved and deeds handed over starting March 4th, 2019. “”
The Turkish government wants to protect international investors’ capital from fraud. This study can help you avoid overpriced real estate sales. The new rule, which was supposed to go into effect countrywide by 2022, has been pushed up after a successful pilot program. All appraisals and reports will be handled by a new department within the TKGM.

About the Appraisal Reports for Real Estate

The SPK verified assessment report will cost between 1.000 and 2.000 Turkish Lira, with buyers paying the amount directly to the new real estate appraisal department. Foreign purchasers should avoid doing business with any estate agency who quotes a higher price or claims to be licensed to conduct the valuation.

Approved appraisal reports are valid for three months. If a sale is terminated, the seller can utilize the same appraisal report if they locate another buyer. The value will be the estimate at the time of completion if the property is off-plan or under construction. The value listed on the appraisal report’s amount will appear on the title documents as well.
The Land Registry and Cadastre Information System will enter the report into their system when the Tapu is signed over before returning it to the buyer. Istanbul is anticipated to be finished in three days, while the rest of the regions will take six days.

Implications for Taxes

The new legislation attempts to eliminate tax avoidance options created by declaring lower property values on Tapu’s. Although sellers in Istanbul normally disclose the true selling price, it is common in many other provinces to register a property’s value at a lesser rate.
If a builder has previously signed over title papers at a lower price than they are sold for, they may face the wrath of the taxman, because address inconsistencies will be detected up in the system.

Because of capital gains tax legislation, foreigners who have already signed for title documents listing the lesser price may face a huge tax bill if they sell it before five years.

Real Estate Appraisal Department of Land Registry and Cadastre
In January 2019, the Land Registry and Cadastre launched a new Real Estate Appraisal Department. The Turkish government aims to collect a precise amount of transportation tax. In most cases, property developers declared the sales price to be half of the true worth. As a result, the state was losing tax revenue as well as other property taxes. The new department in charge of real estate appraisal will use a variety of methodologies to estimate the worth and compile all data into one system. They will also publish study statistics and reports. The valuation procedures will be in accordance with international standards.

Foreign Buyers in Turkey Need a Real Estate Valuation Report
SPK Validated Experts

Capital Market Board is abbreviated as SPK. It is the Turkish stock exchange and banking authority. They are in charge of controlling and regulating capital flows in Turkey. Appraisal firms are regulated financial businesses that follow capital market norms. Appraisal firms and their employees may not work as or for real estate brokers to avoid a conflict of interest.
Valuation reports hold the following information;

  • All title deeds details
  • Coordinates for the location of the property on a map
  • Property photos
  • Prices of equivalent properties
  • Price confirmation
  • Current debt status of the property
  • Confirmed approval with the land register and cadastre general directorate
Real Estate Valuation Report for Foreign Buyers in Turkey