Market news

Investing in Turkish property made easy

18.11.2008

The government is taking steps to make it easier for the citizens of Gulf states and Turkic republics to buy real estate in Turkey by taking into consideration whether or not Turkish citizens are allowed to invest in real estate in those countries


After making it possible for Turkish citizens abroad to bring money back into Turkey under the Varlık Barışı tax regulation, the government is now looking for ways to make it easier for citizens of the Gulf states and Turkic republics to buy real estate in Turkey.

The Varlık Barışı code made it easier for Turkish citizens abroad to invest in Turkish assets by lowering and under certain circumstances eliminating the heavy taxes levied on foreign holdings coming into the country.
Taking action
The first step the government is taking to make it easier for the citizens of the Gulf States and Turkic republics to buy real estate in Turkey is taking into consideration the reciprocity principle. This principle is based on the idea that the ability to purchase real estate is a reciprocal right, whereby, if a Turkish citizen can buy real estate in the country in question, then the citizen of that country may purchase real estate in Turkey.

Citizens in oil rich countries in the Arabian Peninsula, such as Saudi Arabia, the United Arab Emirates, Qatar and Kuwait, as well as citizens from the Turkic republics in Central Asia, have been lining up to buy real estate in Turkey. Their efforts have been thwarted thus far because there has not been an agreement on the reciprocity principle.

The demand in real estate from these parts of the world has brought to attention the need to reconsider the agreements in place. The Ministry of Foreign Affairs is updating the running list of reciprocity agreements in an effort to bring the practice in line with the current circumstances. After the Ministry of Foreign Affairs updates the old list and produces a new one, the legal framework will be renewed to better reflect the updated reciprocity list. The relevant ministries will then sign off on the new legal framework making it easier for citizens of the Gulf States and Turkic republics to buy real estate in Turkey.

Exceptions to the rule that citizens of the Gulf States and Turkic republics cannot buy real estate have been made but at the highest echelons of government. For example, because there was no reciprocity agreement when King Abdullah bin Abdülaziz of Saudi Arabia wanted to buy 57 acres of land in Sevda Tepesi overlooking the Bosphorus, the Turkish Cabinet had to make a special provision for it.

The Ministry of Foreign Affairs has taken the first step in making it easier for foreigners to own property in Turkey by taking the reciprocity agreements under review, said Land Registry Agency vice president Şinasi Bayraktar noting the complexities of figuring out the polices in place in different countries. \"The issue of the reciprocity principle is one that requires expertise and detail oriented attention,\" said Bayraktar. The complexity of determining whether relations between two countries obey the reciprocity principle can lead to confusion. \"Situations arise where in some countries it looks like there is reciprocity when there is not and in others it looks like there is not but in reality there is,\" said Bayraktar. There are times, according to Bayraktar, when the official channels are not sufficient to discover whether or not there is reciprocity in land ownership. \"Sometimes it is not healthy to hash out the details of this issue with just embassies,\" noted Bayraktar.

\"We are going to take up this issue once again. The Ministry of Foreign Affairs is already taking it under consideration,\" said Bayraktar. \"There is a lot of demand from the Gulf states and the Turkic republics,\" he said.


Source: Hürrüyet Daily News

E-mail:
Password:
Forget password?
Registration