The purchase and sale of real estate (immovable property) is one of the most important and often one of the largest financial transactions in the lives of individuals. This transaction carries serious legal risks due to its high value. For this reason, title deed transactions constitute the most critical stage of the process and are strictly regulated by relevant legislation such as the Turkish Civil Code (TCC) and the Land Registry Law. Title deed transactions are carried out at the Land Registry Offices with an official deed in order to ensure a secure transfer of ownership and to protect the rights of the parties.
Legal Framework: Transfer of Ownership and Land Registry
Article 705 of the Turkish Civil Code states that registration in the land registry is mandatory for the acquisition of immovable property. This means that the transfer of ownership of immovable property is only possible through a formal transaction and registration in the land registry.
Turkish Civil Code – Article 705: Acquisition of Immovable Property
Acquisition of immovable property is through registration. In cases of inheritance, court decision, forced execution, occupation, expropriation and other cases stipulated by law, ownership is acquired before registration. However, in these cases, the owner’s ability to perform disposition transactions depends on the registration of the ownership in the land registry.
Real Estate Purchase and Sale Process and Title Deed Transactions
- Preliminary Research and Agreement: An agreement is reached between the buyer and the seller on the characteristics of the immovable property, sales price and payment terms. At this stage, it is critical to conduct preliminary research on the title deed, zoning status, and encumbrances such as mortgages and liens, if any.
- Preparation of Necessary Documents: Certain documents are requested from both the buyer and the seller for title deed transfer (title deed, identity card, letter of no tax debt, TCIP policy, etc.).
- Land Registry Fees and Revolving Fund Fee: In the sale of real estate, both the buyer and the seller pay a title deed fee of 20 per thousand over the sale price. In addition, a revolving fund fee is also paid.
- Transaction at the Land Registry Office: After the necessary documents and payments are completed, the buyer and seller are present at the Land Registry Office. The land registry officer reads the sales contract called “official deed” and the parties sign it.
- Registration and Issuance of Title Deed: After the official deed is signed, the ownership of the immovable property is registered in the land registry and the new title deed is delivered to the buyer.
Legal Points to be Considered in Buying and Selling Real Estate
- Detailed Examination of the Land Registry: It should be checked whether there are any restrictions such as mortgage, lien, annotation on the immovable property.
- Zoning Status and Licences: The zoning status of the immovable, whether there is a building licence and occupancy licence should be questioned from the municipality.
- Tax Debts: It should be learnt whether the immovable has debts from past periods such as property tax.
- Power of Attorney Check: If the transaction is made through a proxy, the validity and scope of the power of attorney should be carefully examined.
- Title Deed Fee Declaration: The title deed fee must be paid over the actual sales price. Under-declaration may lead to tax penalties in the future.
Since the purchase and sale of real estate is a high-value transaction that may be difficult to return, it requires maximum attention and legal knowledge at every stage of the process. Title deed transactions are an official process that ensures the safe transfer of ownership. Detailed examination of the title deed, zoning status and restrictions on the immovable property is critical for a smooth transfer. In this complex process, it is highly recommended to get professional legal support from a real estate lawyer in order to minimise possible risks.