The purchase of immovable property by foreign nationals in Türkiye is possible within the conditions and limits drawn by the legislation. In recent years, alongside the foreign capital directed at dwellings, land and commercial immovable property, investments made with the aim of acquiring citizenship have also increased markedly.
The acquisition process does not, however, consist of a purchase decision alone. Headings such as military prohibited zones, security restrictions, the requirement of a valuation report, foreign exchange legislation and land registry transactions are decisive at every stage of the process. In practice, forged powers of attorney, zoning and permit problems and disputes arising from citizenship applications also frequently come onto the agenda.
In this briefing note we address the conditions under which foreign nationals may acquire immovable property, the restrictions to which they are subject, the stages of the purchase process, the special regime applicable to companies, citizenship investments and the judicial avenue to be pursued in any disputes.
May Foreign Nationals Acquire Immovable Property in Türkiye?
The acquisition of immovable property in our country by foreign natural persons is legally possible, provided the conditions prescribed in the legislation are satisfied. Activity in this field has increased particularly in the recent period; dwellings, land, commercial immovable property and investments directed at citizenship have become the prominent preferences among foreign buyers.
That possibility is not, however, unlimited. Zone restrictions on security grounds, upper limits as to surface area and prohibitions arising from special statutes are the fundamental elements drawing the boundaries of acquisition in practice.
Statutory Framework of the Regulation
The fundamental provision regulating the acquisition of immovable property by foreign nationals is Land Registry Act, Art. 35.
That article makes the acquisition of immovable property by foreign natural persons subject to certain conditions, and sets out the procedure for acquisition, the restrictions to be applied and the instruments of administrative supervision. Alongside the text of the statute, the regulations on the subject, Presidential decisions and the provisions contained in special statutes also play a decisive role in practice.
Repeal of the Reciprocity Condition
In the previous period, the ability of foreign nationals to purchase immovable property was subject to the principle of "reciprocity". Under that principle, only the nationals of States which granted Turkish citizens the right to acquire immovable property in their own country could acquire property in Türkiye.
By the statutory amendments made, this condition was repealed and the opportunity for foreign nationals to acquire property expanded considerably.
It should nevertheless not be overlooked that various restrictions are still applied in respect of the nationals of certain countries.
Nationals of Which Countries May Acquire Property?
Which countries’ nationals may acquire immovable property in Türkiye is determined by the relevant legislation and by Presidential decisions.
It is not the case that every foreign national may acquire property without limit. In respect of some countries a condition of obtaining special permission may be imposed; for some countries a restriction is applied by reference to surface area; in some cases acquisition is limited to particular regions only, and in some cases it may be prohibited altogether. For that reason the nationality of the person concerned must be assessed separately before a purchase decision is taken.
Distinction Between Natural Persons and Foreign Companies
Acquisition by foreign natural persons and acquisition by foreign companies are subject to different legal regimes.
While natural persons may purchase immovable property under certain conditions, stricter rules and special permission mechanisms come into play in respect of companies.
There are, moreover, notable legal differences between companies with foreign capital established in Türkiye and companies subject directly to the law of a foreign country.
General Restrictions on Acquisition
A series of general restrictions applies to the acquisition of immovable property by foreign nationals. Those prominent in practice are the following:
- Prohibitions and restrictions arising from special statutes
- A ceiling of 30 hectares per person across the country (this limit may be raised by Presidential decision to as much as 60 hectares)
- The rule that 10% of the area subject to private ownership in a given district may not be exceeded
- Areas falling within security zones
- Places with the status of military prohibited zones
Against this background, it is of great importance that a foreign investor have a legal examination carried out before the purchase and establish whether the immovable property is amenable to acquisition.
Statutory Restrictions on Acquisition
Although it is possible for foreign natural persons to acquire immovable property, this right is not absolute. Various statutory limits have been introduced in line with public security, military sensitivities, the protection of strategic areas and national policies.
In making an assessment, therefore, not only the legal position of the immovable property but also its location, surface area, purpose of use and the nationality of the buyer must be addressed together.
Military Prohibited Zones
Foreign nationals are not permitted to acquire immovable property in military prohibited zones. Certain places in the vicinity of military units, strategic facilities and defence areas are kept closed to acquisition in this context.
For that reason, when land registry transactions are being carried out, whether the immovable property falls within the boundaries of a military prohibited zone is examined by the relevant institutions.
Security Zones
Some immovable properties may fall within areas declared to be special security zones. In places of that kind the acquisition of property by foreign nationals may be prohibited altogether, or it may equally be made subject to the condition of obtaining special permission.
The security assessments made in respect of settlements along the border and areas of a strategic character are decisive in practice.
Surface Area Limit at District Level
The quantity of immovable property that may be acquired by foreign nationals within the boundaries of a district is restricted by reference to surface area.
Accordingly, the total surface area of the immovable property acquired by foreign nationals may not exceed 10% of the area subject to private ownership in the district concerned.
The purpose of the regulation is to forestall the concentration of foreign ownership in particular regions.
Upper Limit of Acquisition per Person
The quantity of immovable property that a foreign natural person may acquire across the country is restricted, both so that the ownership structure may be supervised and by reason of strategic security concerns.
Under Land Registry Act, Art. 35, the total surface area of the immovable property that a foreign natural person may acquire throughout Türkiye may not exceed 30 hectares. It is possible for this ceiling to be raised by Presidential decision to twice that figure, that is to say to 60 hectares.
In this framework the nature of the immovable property, the purpose for which the acquisition is made and whether the person’s total surface area across the country remains within the 30/60 hectare limit are assessed separately. In particular, where purchases are made piecemeal in different provinces, the person’s total ownership nationwide is checked through the systems of the General Directorate of Land Registry and Cadastre. If it is established that the limit has been exceeded, it may not be possible for the land registry transaction to be carried out.
Restrictions Arising from Special Statutes
Certain types of immovable property are subject, beyond the general regime, to additional restrictions arising from special statutes. The principal areas that must be assessed in this context are the following:
- Areas classified as forest
- Regions allocated to energy and mining activities
- Protected conservation sites
- Places subject to the coastal legislation
- Agricultural land (a foreign national who purchases an immovable property in the nature of a field, vineyard or orchard is obliged to prepare an agricultural project within 2 years of the date of purchase and to submit that project for the approval of the relevant Ministry; if the project is not completed within the period or is not approved, the sale and liquidation of the immovable property by the administration comes onto the agenda)
For that reason a foreign investor must not confine their examination to the land register entry, but must also investigate the special legal status to which the immovable property is subject.
Presidential Decisions and Country-Specific Practice
Special restrictions on the acquisition of immovable property may be applied in respect of the nationals of certain countries. The framework of these restrictions is determined by the relevant legislation and by Presidential decisions. In respect of the nationalities concerned, acquisition may be made subject to the condition of special permission, may be restricted by reference to surface area, may be limited to particular regions only or may be prohibited altogether.
It is therefore appropriate that a current legal assessment be made as to the buyer’s nationality before the process is embarked upon.
Stages of the Purchase Process
The acquisition of immovable property by foreign nationals is not a transaction completed by the signature of a single contract; it is a multi-stage process encompassing land registry procedures, banking transactions, a valuation report, foreign exchange transactions and various administrative steps.
In this process the examination of the land register entries, the investigation of the encumbrances over the immovable property and an analysis of suitability as regards citizenship or a residence permit are of particular importance.
Obtaining a Tax Number
Before the purchase of an immovable property can be begun, the foreign national must first obtain a Turkish tax number. That number is among the documents required for the conduct of tax transactions, the making of official payments, the opening of a bank account and land registry procedures. In practice the tax number may be obtained from the relevant tax offices.
Opening a Bank Account in Türkiye
In order for the sale price to be paid and the official transactions to be conducted, foreign investors most often open a bank account in Türkiye. Bank records have a critical function as regards the creation of official payment records, the support of citizenship applications, the carrying out of currency exchange transactions and the transfer of the sale price.
Identifying the Immovable Property and Legal Examination
A comprehensive legal examination must be carried out before a purchase decision is taken. That examination should focus on suitability as regards the citizenship legislation, whether there is a pending action concerning the immovable property, the permit and occupancy permit position, its position in the zoning plan, the annotations on the land register entry, mortgage and attachment entries and the general state of the land register.
In practice, transactions carried out without a sufficient examination may lead to serious detriment for foreign investors.
Verification Through the Land Register Entries
Detailed examination of the register entry for the immovable property to be purchased is obligatory. In that examination, entries constituting an impediment to sale, family residence annotations, rights of pre-emption, attachments, mortgages, other encumbrances over the immovable property and information relating to the owner must each be checked separately.
Mandatory Valuation Report
Obtaining a valuation report is obligatory in the acquisition of immovable property by foreign nationals. That report enables the true market value of the immovable property to be determined. The report is valid for 3 months from the date on which it is drawn up; before the sale is completed it must be checked whether that period has expired.
The valuation report performs a decisive function in particular as regards the prevention of simulated transactions, the establishment of the sale price and citizenship applications.
Issue of a Foreign Currency Purchase Certificate
The foreign buyer must sell the price of the immovable property to a bank in foreign currency and obtain in return a "Foreign Currency Purchase Certificate". Payment must be made to the seller in Turkish lira through a bank. Registration at the land registry in the name of a foreign national cannot be carried out without the certificate being produced.
Transactions at the Land Registry Directorate
The sale is made in official form at the land registry directorate. At this stage the registration transactions are carried out, fees and taxes are collected, the official deed is prepared, an interpreter is appointed where necessary and the identity of the parties is verified. In practice, in transactions to which a foreign national is a party, it may be necessary for a sworn interpreter to be present.
Completion of Registration
Upon the completion of the official transactions at the land registry directorate and the effecting of registration, ownership of the immovable property passes to the foreign investor.
With registration, the foreign national acquires in law the status of owner over the immovable property.
Transactions Conducted by Power of Attorney
Foreign nationals may also conduct immovable property purchase transactions by way of a power of attorney. In practice, however, problems arising at the translation and notary stage, simulated transactions, the exceeding of the limits of the authority granted to the agent and forged powers of attorney may lead to serious disputes.
For that reason it is of great importance that the documents be examined and legal verification ensured when transacting by power of attorney.
Acquisition of Immovable Property by Foreign Companies
The acquisition of immovable property in Türkiye by foreign companies is subject to different rules from that by natural persons. Where the company was established, its field of activity, its capital structure and the purpose for which the immovable property is to be used are decisive elements in practice.
Moreover, the conditions of acquisition for companies with foreign capital established in Türkiye and for companies subject directly to the law of a foreign country also diverge from one another.
Companies Subject to the Law of a Foreign Country
The acquisition of immovable property in Türkiye by companies subject directly to the law of a foreign country is as a rule possible only in limited cases. For those companies, acquisition is for the most part made subject to the provisions of special statutes and to administrative permission processes.
In the assessment, the region in which the immovable property is situated, the nature of the immovable property, the purpose of the investment and the company’s field of activity are taken into account. In some situations it may not be possible for such companies to acquire immovable property directly.
Companies With Foreign Capital Established in Türkiye
A different regime applies in respect of companies with foreign capital established in Türkiye under Turkish law.
Since such companies are as a rule regarded as Turkish companies, they are subject, save for certain exceptions, to the acquisition provisions applied to Turkish companies. That said, the purpose for which the immovable property is to be used, the company’s field of activity, its control structure and the proportion of foreign shareholding may be examined separately.
Land Registry Transactions in the Name of a Company
In land registry transactions to be conducted in the name of a company, it must be proved by official documents that those representing the company are duly authorised. In that respect translation and apostille procedures, documents evidencing the authority of representation, board resolutions, signature circulars and trade registry records are important.
Documents belonging to foreign companies must most often be submitted together with notarial certification and an apostille.
Special Permission and Restrictions
Acquisition by foreign companies may in some cases be made subject to special permission processes and administrative supervision. Various restrictions may be applied as regards agricultural land, energy and mining sites, strategic areas, security zones and military prohibited zones.
In addition, provisions of special legislation and additional permission mechanisms may come into play for foreign companies operating in particular sectors.
Turkish Citizenship Through Investment in Immovable Property
The acquisition of Turkish citizenship in return for investment in immovable property is one of the methods to which foreign investors have had recourse most often in recent years. Foreign natural persons who acquire immovable property above a certain value may, if they satisfy the conditions in the legislation, make an application for citizenship by the exceptional route.
Investments made for citizenship purposes are, however, subject to far more intensive legal and administrative scrutiny than an ordinary purchase of immovable property. The correct calculation of the investment amount, the payment of the price through the banking system, the suitability of the immovable property for citizenship purposes and the entry of the requisite annotations on the land register are at the focus of that scrutiny.
In addition, simulated sales, valuation reports that do not reflect the truth, the use of the same immovable property in more than one application and irregular methods of payment may lead to serious disputes and to the rejection of the application.
For that reason it is important that a detailed legal examination be conducted, that the legal position of the immovable property be analysed and that the process be managed with expert support before a purchase is made for citizenship purposes.
Conditions Required
Whether citizenship may be acquired through investment in immovable property depends on the conditions prescribed in the legislation being satisfied together. Those conditions may be listed as follows:
- That the investment has been made in conformity with the legislation
- That an annotation prohibiting sale is entered on the land register for the immovable property
- That the sale price is paid in accordance with the prescribed procedure
- That immovable property is purchased at the minimum amount determined
- That the applicant bears the status of a foreign natural person
Citizenship applications are not confined to the land registry transaction; bank records, valuation reports and official documents are also subjected to detailed examination.
Minimum Investment Amount
For the purposes of a citizenship application, the immovable property acquired must meet a certain minimum value.
Under the regulations of 13 May 2022 and thereafter, in order to become entitled to exceptional Turkish citizenship the value of the immovable property to be purchased must be at least USD 400,000 (or the equivalent in foreign currency). Investments falling below that threshold are not regarded as suitable for an application.
In practice, foreign currency purchase certificates, transfer records at the bank, the value stated in the valuation report and the sale price shown at the land registry are assessed together. Sale prices that do not reflect the truth and simulated transactions may result in the rejection of the application.
On the other hand, it may also be possible for more than one immovable property to be taken into account together with a view to meeting the investment threshold.
Three-Year Prohibition on Sale
A prohibition on sale is applied for a period of 3 years in respect of immovable property acquired for citizenship purposes. This restriction is entered on the land register with the wording "undertaking within the scope of the Regulation on the Implementation of the Turkish Citizenship Act No. 5901". Deletion of the annotation or transfer of the immovable property before the three-year period has expired may lead to the annulment of the citizenship acquired.
In this context simulated transactions and transfers, gifts and sales of every kind are examined carefully by the administration.
Certificate of Conformity
In order for an application to be made, a certificate of conformity establishing that the investment in the immovable property complies with the legislation must be obtained. At this stage the relevant administrations examine in detail conformity with the citizenship legislation, the valuation report, the payment records, the value of the investment and the legal position of the immovable property.
Whether the same immovable property has previously been made the subject of another citizenship application is of particular importance in that examination.
The Application Process
Following the completion of the investment, the foreign investor may make the citizenship application. In the application file, passport and identity documents, the valuation report, foreign currency purchase certificates, bank receipts, the certificate of conformity and the land register entries are submitted to the relevant institutions.
Applications are assessed not only from a formal standpoint but also as regards security, public order and the genuineness of the investment.
Grounds for Rejection of an Application
Citizenship applications may in practice be rejected on various grounds. The principal grounds for rejection are the following:
- That the documents submitted are incomplete or erroneous
- That payment has been made contrary to the banking procedures
- That the valuation report does not reflect the truth
- That the sale is simulated in nature
- That the immovable property does not have the qualities required
- That the conditions of investment have not been satisfied
In addition to these, security investigations and assessments relating to public order may also affect the outcome of the process.
Immovable Property Unsuitable for Citizenship Purposes
Not every immovable property is acceptable for the purposes of a citizenship application. The categories of immovable property that give rise to risk in practice are the following:
- Those that are problematic as regards mortgages and encumbrances
- Those whose valuation does not reflect the truth
- Those with a permit or occupancy permit problem
- Those belonging to projects involving a legal dispute
- Those that have been made the subject of a simulated sale
- Those that have previously been used in a citizenship application
For that reason the payment process must be structured in conformity with the legislation before the purchase, the valuation report must be assessed, project and permit checks must be carried out and the land register entries must be examined.
Position as Regards Timeshare and Construction Servitude
In citizenship applications it is appropriate that preference be given to immovable property on which there is a building (over which condominium ownership has been established) or for which a building permit has been obtained (over which a construction servitude has been created). Where an application is made on the basis of vacant land, a particular project requirement applies. Immovable property in the nature of a timeshare, for its part, is not regarded as suitable for the acquisition of citizenship.
Nationality of the Seller and Prohibition on Resale
The immovable property to be relied upon for citizenship must not have been purchased from the buyer’s spouse or children, or from another foreign national holding the same nationality as the buyer. Furthermore, the resale of the immovable property after 3 years, once citizenship has been acquired, to its former owner or to persons connected with them may be characterised as "simulation" (a sham transaction) and regarded as a ground for the annulment of citizenship.
Courts With Jurisdiction in Disputes
In disputes arising from the acquisition of immovable property by foreign nationals or from citizenship processes, the branch of the judiciary to be resorted to varies according to the subject matter of the action and the nature of the opposing party. Making that distinction correctly is of critical importance if the action is not to be dismissed on procedural grounds.
Administrative Judicial Avenue Against Citizenship Decisions
The rejection of a citizenship application based on an investment in immovable property, the failure to issue a certificate of conformity or its subsequent annulment are in the nature of an "administrative act". In these disputes:
- Type of action: An action brought seeking the annulment of the administrative act.
- Court with territorial jurisdiction: The administrative court at the place where the administration that performed the act (the relevant Governorship or Ministry) is situated.
- Court with subject-matter jurisdiction: The Administrative Court.
For details on the subject, our study entitled Action for the Annulment of a Decision Rejecting a Citizenship Application may be consulted.
Civil Judiciary in Sale and Registration Disputes
The position is different in private law disputes such as the failure to register the immovable property purchased, non-conformity with the contract of sale, errors in the land register entry or the failure to transfer ownership notwithstanding that the conditions for citizenship have arisen:
- Type of action: An action for annulment of title deed and registration, or an action for a contractual debt or for damages.
- Court with territorial jurisdiction: Under the Code of Civil Procedure No. 6100, the court of the place where the immovable property is situated; in actions concerning rights in rem over the immovable property, jurisdiction is exclusive.
- Court with subject-matter jurisdiction: The Civil Court of First Instance; if the transaction is in the nature of a consumer transaction, the Consumer Court may have jurisdiction.
Independent Legal Assessment
Although the acquisition of immovable property by foreign nationals may appear on the surface to be a standard purchase and sale, in the background the administrative permission regime, foreign exchange legislation, security assessments and citizenship law operate at the same time. The great majority of the problems encountered in practice arise from the legal and administrative status of the immovable property not having been sufficiently investigated before the purchase. Even where the market value of an immovable property is appropriate, it may be closed to acquisition by reason of the region in which it is situated or the character it bears.
In investments made for citizenship purposes the risk is more concentrated still, for what must be considered here is not only the acquisition of ownership but also that the status acquired is not subsequently annulled. In a particular file it is appropriate that the following headings be addressed as a priority:
- Investigating the immovable property with the relevant institutions as regards military prohibited zones, security zones and areas of special status
- Reviewing the current Presidential decisions and country-specific restrictions as regards the buyer’s nationality
- Calculating the existing ownership position against the 30/60 hectare limit per person and the 10% rule in the district
- Documenting the flow of payments in full by foreign currency purchase certificates and bank records
- Planning from the outset, in citizenship applications, the consequences of the 3-year annotation and the prohibition on resale
- Verifying the scope of the authority of representation and the genuineness of the document in transactions conducted by power of attorney
Independent Legal provides advisory services throughout the whole of the process in the immovable property investments of foreign natural persons and companies, from the legal examination stage through to land registry transactions and the conduct of disputes arising from citizenship applications.