New Regulation on Currency Exchange for Foreign Property Sales

Recently the Turkish Government has released a new regulation regarding the payment method of foreign property sales and made changes to the property sales process to foreign buyers. The new regulation is effective as of January 24, 2022.

According to this new regulation, foreigners now must exchange foreign currency to Turkish Lira in order to purchase real estate. Foreign currency equal to the sales amount of the property must be sold to the Central Bank of the Republic of Turkey in exchange for the Turkish Lira in order to make the purchase.

How to Exchange Foreign Currency to Turkish Lira for Property Purchase?

The conversion made through other exchange methods, like in exchange offices or in person, is not accepted for property purchases. This exchange can only be done through a Turkish bank. Here is how does foreign property purchasing process proceeds according to this new regulation;

Step 1: Foreign currency equal to the sales amount of the property must be transferred to a Turkish bank by the buyer, the seller, their proxies, or representatives. The only foreign currencies accepted by the Central Bank of the Republic of Turkey for currency exchange to buy real estate are USD, Euro, and Pound Sterling.

If the buyer wants to make his/her payment in currencies other than the ones stated above, the bank will exchange the sales amount to USD, Euro, or Pound Sterling a day before the transaction to the Central Bank of the Republic of Turkey.

Step 2: The bank will transfer the foreign currency to the Central Bank of the Republic of Turkey and will pay the Turkish lira equal of the foreign currency transferred to the buyer, seller, proxy, or representative. At the same time, the bank will issue a Foreign Currency Exchange Document (Döviz Alım Belgesi).

The Foreign Currency Exchange Document must include the following;

• Name and surname of the person on whose behalf the currency is exchanged
• Passport or ID number
• US Dollar equivalent of the foreign currency purchased (TL equivalent is always included).
• The statement of “This transaction is carried out within the scope of Article 13 of the Circular on Capital Movements.”.

Step 3: The buyer must present the Foreign Currency Exchange Document to the Land Registry Office as proof whilst applying for title deed transfer. The most important point here is that the document must be issued before the sale transaction.

We can carry out these procedures on your behalf with your power of attorney in the case of physical difficulty or language barrier.

The rest of the sales process proceeds the same as before. You can check out our Property Buying Guide for detailed information.

If the payment is made before the effective date of this regulation, obtaining a Foreign Currency Exchange Document is not necessary for title deed transfer. However, an approved bank receipt must be submitted to the land registry office. Other payment methods are not accepted.

Is Currency Exchange Mandatory to Get Turkish Citizenship Through Real Estate Investment?

This new regulation made the Foreign Currency Exchange Document compulsory for all title deed transactions to foreign property buyers regardless of the reason of purchase.

In the case of Turkish citizenship applications, the Directorate of Land Registry and Cadastre additionally request an approved bank receipt proving that the sales amount has been transferred to the seller’s bank account.

The receipt can be submitted before the commitment process or the issuance of the conformity document at the latest. In any case, the receipt must be submitted to the Land Registry Directorate before the title deed transferring process.

Bayram Tekce, The Chairman of Tekce Overseas, expresses that this new regulation won’t affect the ongoing sales processes and prices.

Buying a property in Turkey is still an easy and safe process if you work with a professional real estate agency. The expert team of Trabzon Homes ® is ready to guide you in the property purchase from finding your dream house to obtaining your title deed.

You can check out the guidebook prepared by the Directorate of Land Registry and Cadastre for more information on this regulation.