Property sales and Rentals to be set in Turkish Lira, but non-residents and Turkish Nationals living abroad are exempt!
Darren Edwards founder of Luxury Property Turkey, comments regarding the current ruling by the Government of Turkey that property sales and rental agreements must be in Turkish Lira,it’s important to note that the official gazette has announced that non-residents and Turkish nationals residing outside of Turkey are exempt from this law! This continues the government approach of being pro foreign investment!
In fact all property sales transactions have always been converted in TL when calculating and paying stamp duty tax and registering the title deed, the official figure shown on any deed has always been in TL.
Most contracts are private contracts and kept separate from the official deed transfer, so I don’t expect much to change, my opinion is that the law is more aimed at commercial rents that have long been done in USD and with the recent currency fluctuations it has had a negative impact on retail and commercial tenants and been a windfall for landowners, I actually believe that rents being fixed in TL will make businesses feel more secure in stepping in to new premises on long term deals and could eventually drive up the value of commercial premises.
Obviously we don’t yet know how firmly this new law will be implemented and monitored but it seems realistic to me that developers in regions such as Istanbul and Bodrum that attracts mainly domestic buyers and have previously priced in either USD or Euro will will be forced to convert to TL , this could positively stabilize the market and provide easier comparisons.
We will of course keep an eye as the law rolls out and keep you informed of the trends that follow,.