Title: The Hidden Cost Of Managing A Property In Turkey
According to the most recent global house price report from Knight Frank, Turkey has seen property prices rise by more than 12%. This, combined with strong rental yields and a loosening of restrictions on foreign ownership has seen Turkey’s popularity grow as a second home destination. However, according to Istanbul based property management company, tampm.org, investors are often being caught out by the hidden costs of ownership.
Tugba Tire, General Manager of tampm.org says “We have seen a lot of cases were overseas buyers have purchased a property with an agent only to find that they have been left to sort out the management of the property themselves which inevitably results in higher ownership costs.
The development companies they are left to deal with often lack the resources and specialist staff needed to handle the requirements of an international buyer. The investor is then left spending a lot of valuable time and money attempting to source the right people themselves.”
A property that looks like a dream holiday home or investment property can often turn into a mountain of red tape for unwary buyers who may not be aware of the laws and customs of Turkey or speak the language.
According to TAMPM, lawyers dealing with property matters can sometimes have a conflict of interest if they have been appointed by property agents rather than the buyer themselves.
While it is advisable to have a Turkish speaking lawyer checking through paperwork – and particularly when it comes to obtaining a TAPU (proof of property ownership) it is also equally important that the lawyer is independent and impartial.
A good, local property management company can act in the investor’s best interests in much the same way as having a letting agent appointed in the UK. They will be able to sort out the paperwork and provide guidance on legal and tax matters while working independently of agents and developers.
For example, anyone who rents out their property in Turkey has to pay income tax. This is the case even if the property happens to be a holiday home or residential investment property.
The income generated from a property that is being rented out must be declared and details passed on to the tax office in good time.
“Buyers are often not even aware that they need to register their property tax ID within 3 months after the transfer of title or that they need to activate their income tax ID at the tax office where they will file their yearly return. Unfortunately there are big fines if they don’t file their returns on due dates.” Added Tire.
For more information on property management in Turkey visit www.tampm.org.
Notes to the editor
TAM Property Management based and active in Istanbul since 2005, we have a proven and successful track record in adding-value to the properties we have under management. We are specialists in the residential, vacation rentals and office sector in Turkey and offer our clients hands-free property management solutions.